However, we also want to assign a value of 1 to observations that fall below the tagged observation where status does not change. This can be useful because you may want to investigate whether the length of time spent in a state (for unemployment, also called "spell of unemployment") affects well-being. It may be that there is no significant change in well-being for individuals who transition out of and into employment in the space of a year but not for those who spend a longer period out of employment. This allows you to check this.
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Brendan
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