(Economics) Transition matrices: transition rates, activity rate

#1
Hello everyone... it's been a while. I have a question for the econometricians out there. I have active labor

1. I have the following transition matrix (active and inactive labor participation 2012 and 2013), and I need to find the transition rates for AI and IA.

-------A----I
A-----55---5
I------5----35


2. I turn the matrix into probabilities:

-------A----I
A-----.92---.13
I------.08---.87


3. Our two transitions rates are AI and IA.
Transition rate AI = (ai = AI/A) = .13
Transition rate IA = (ia = IA/I) = .08


4. Activity rate IA/(IA+AI) = .08/(.08+.13) = .38
Activity rate AI(AI+IA) = .13/(.13+.08) = .62


Are the formulas that I'm using correct? Should I end up with two activity rates? THANK YOU SO MUCH!
 
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