As described above, the proportional hazards model does not let us test specific hypotheses about the shape of the

hazard function.

The x[beta] term, determined by the player's personal and productivity characteristics, shifts the baseline

hazard function, but it affects the baseline

hazard function in exactly the same way each period.

Figure 3 contains Kaplan-Meier

hazard functions for disenrollment spells (i.

For the exponential

hazard function, the expected value of tenure, given age, is just

Next we need to specify the distribution of the baseline

hazard function.

Analyzing the Z-scores across de novo banks of different ages provides some support for the shape of the de novo bank

hazard function in figure 3.

The predicted hazard rates based on these logit estimates can be derived by substituting the estimated coefficients into the

hazard functions given in Equations 1 and 5.

The

hazard function is deemed increasing if [Alpha] [greater than] 1 [equivalence] ([Delta][Lambda]/[Delta]t) [greater than] 0, decreasing if [Alpha] [less than] 1 [equivalence] ([Delta][Lambda]/[Delta]t) [less than] 0, and constant if [Alpha] = 1 [equivalence] ([Delta][Lambda]/[Delta]t) = 0; the Weibull distribution simplifies to the exponential where there is no duration dependence.

1) Normal running mileage and constant

hazard function ([X.

In the presence of censored data, the appropriate model for examining the probability of being employed is the survival model (or

hazard function model), which is applied to data that specify the time elapsed until an event occurs [Retherford and Choe (1993)].

The pdf of the failure time of the gearboxes was determined and, hence, the survivor function and

hazard function could be constructed.

The model is semi-parametric in that it does not require specification of the form of the

hazard function in advance, but rather is based on the assumption that all

hazard functions for the sample are proportional to a baseline

hazard function (Singer & Willet, 1991).