The purpose of this paper is to demonstrate that a more accurate method exists to produce estimates of unemployed entrants into the labor force than the one currently used. Unemployed entrants are an important component in the estimation methodology for unemployment estimates and the unemployment rate at sub-state levels. The current methodology in use to estimate entrants dates back to the early 1980’s and does not accurately reflect labor market trends.
Accuracy of the unemployment statistics is important at sub-state levels because they are one of the few economic indicators available for counties and cities. The Federal government uses these unemployment statistics to allocate funding for various entitlements and assistance programs. In fiscal year 2001, over $25 billion in federal funds were distributed based on these estimates.
During the past two decades the prevalence of overweight and obesity in children has increased rapidly worldwide (1–5). These trends have been associated with various changes in the social, economic and physical environment related to the nutrition transition (6). The nutrition transition is generally associated with an increase in the consumption of energy dense foods that are low in fibre, sugar, and sweetened drinks, a decrease in physical activity and a more sedentary lifestyle. Thus, overweight and obesity have become serious, large scale, global, public health concerns (7, 8). The obesity epidemic has been associated with a dramatic increase in related healthcare costs, for example in the USA a more than a threefold increase between 1979 and 1981 and 1997–1999 was observed (9).
Childhood obesity, itself, is associated with a wide range of serious medical complications. Early medical consequences of obesity include orthopaedic complications, metabolic disturbances, type 2 diabetes, disrupted sleep patterns, poor immune function, skin problems, impaired mobility, and increased blood pressure and hypertension (10). Childhood obesity has an immediate impact on a child’s physical appearance and can result in additional psycho-social consequences, such as a low self-esteem, social alienation, and lack of self-confidence (10, 11), discrimination (12) and, for girls, depression (13). Additional long-term health risks are partly related to the tracking of childhood obesity into adulthood. Long-term follow-up studies show that obese children tend to become obese adults (14–16). Related to the continuity of obesity into adulthood are long-term consequences of childhood obesity such as increased risk of cardiovascular disease, insulin resistance, type 2 diabetes, hyperlipidaemia, gall bladder disease, osteoarthritis and certain cancers (11). Moreover, adults who were obese children have an increased risk on morbidity and mortality independent of their adult weight (11). Obese children are more vulnerable to orthopaedic abnormalities related to damage to an unfused growth plate, slipped capital epiphyses, bowing of the legs and tibial tortion, sleep disorders, and insulin resistance has been noted even in children below 10 years (11).
The role of liquidity in asset pricing has attracted considerable attention in recent years. Liquidity risk is often used by researchers to account for the portion of market prices that is unexplained by existing pricing models. In the bond literature, it has long been acknowledged that credit risk alone cannot capture the level of corporate bond yield spreads, and thus liquidity has been introduced to explain this so-called “credit spread puzzle”. Investors demand a liquidity premium for holding illiquid securities, such as corporate bonds, thus increasing the level of spreads beyond what is explained by default risk (Elton et al., 2001).
