2013 UnemploymentDynamicsintheOECD

(Elsby et al., 2013) ⇒ Michael WL Elsby, Bart Hobijn, and Ayşegül Şahin. (2013). “Unemployment Dynamics in the OECD.” In: Review of Economics and Statistics Journal, 95(2). doi:10.1162/REST_a_00277

Subject Headings: Unemployment Rate.

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Abstract

We provide a set of comparable estimates for the rates of inflow to and outflow from unemployment using publicly available data for fourteen OECD economies. Using a novel decomposition that allows for deviations of unemployment from its flow steady state, we find that fluctuations in both inflow and outflow rates contribute substantially to unemployment variation within countries. Anglo-Saxon economies exhibit approximately a 15:85 inflow-outflow split to unemployment variation, while continental European and Nordic countries display closer to a 45:55 split. In all economies, increases in inflows lead increases in unemployment, whereas outflows lag a ramp-up in unemployment.

1 Introduction

Unemployment rates among developed economies have varied substantially both across time and across countries over the last 40 years. This variation in unemployment may occur as a result of variation in the rate at which workers flow into the unemployment pool, variation in the rate at which unemployed workers exit the unemployment pool, or a combination of the two. The relative contributions of changes in in-flow and out-flow rates to changes in unemployment have been abundantly documented for the U.S.[1] Less is known, however, about the driving forces of unemployment variation in other countries. Such a question is of interest because of the considerable variation in unemployment that has been observed in developed economies in recent decades, notably in Continental Europe. In this paper, we provide a detailed analysis of unemployment flows for fourteen developed economies using publicly available data

References

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	Author	volume	Date Value	title	type	journal	titleUrl	doi	note	year
2013 UnemploymentDynamicsintheOECD	Bart Hobijn Michael WL Elsby Ayşegül Şahin			Unemployment Dynamics in the OECD				10.1162/REST_a_00277