The Duration of New Job Matches in East and West Germany

This study compares the duration of new job matches in the east and
west German labour market that formed between the start of the
German Economic, Monetary and Social Union in July 1990 and
December 2000. The study relies on job duration data drawn from the
German Socio-economic Panel. It shows with non-parametric duration
methods that job matches are less stable in east than in west
Germany. However, this is not the case in the first years of the
transition process, in which most likely the more profitable jobs
were created and the best job matches were formed. Results form the
non-parametric analysis but also from a proportional hazards model
that controls for important covariates imply that the transition
rates into alternative jobs and into unemployment vary with tenure
in a way, which is in line with predictions of theories of job
mobility such as the job specific capital hypothesis and matching
theories.