Accounting for Work Life Expectancy: Applying the Skoog-Ciecka-Krueger Transition Probabilities

摘要

While many forensic economists rely on the Skoog-Ciecka-Krueger work life tables, few seem to make use of the labor force transition probabilities provided as supplemental material to the published tables. This paper explains the calculations needed to compute the probability of labor force activity for a person who is an initially active or an initially inactive labor force participant based on these transition probabilities. Following this explanation, the explicit use of the probability of labor force activity is compared to the common methods of accounting for work life expectancy. The paper concludes by identifying the issues that use of the probability of labor force activity presents.