15
Figure 3.5. Transitions between employment and nonemployment (log transition rates).
A. From nonemployment to temporary and permanent employment.
B. From employment to unemployment and nonparticipation.
4. The Cyclicality of Temporary Work
4.1 Estimation of Transition Rate Models
We have estimated a number of transition rate equations using as cyclical variable a measure of
the GDP-gap defined as the log ratio of GDP to trend GDP and denoted YDEV. To obtain a
series on trend GDP we regressed quarterly values of log GDP on a linear time trend and
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