BazEkon - The Main Library of the Cracow University of Economics

BazEkon home page

Main menu

Author
Marjanović Gordana (University of Kragujevac, Republic of Serbia), Mihajlović Vladimir (University of Kragujevac, Republic of Serbia)
Title
An Analysis of the Factors of Nairu Dynamics in Selected OECD Countries
Source
Argumenta Oeconomica, 2016, nr 1 (36), s. 87-103, tab., bibliogr. 46 poz.
Keyword
Bezrobocie, Bezrobocie długotrwałe, Stopa bezrobocia
Unemployment, Long-term unemployment, Unemployment rate
Note
summ.
Abstract
Unemployment represents one of the major problems in modern economies. In order to create appropriate measures for its reduction, it is necessary to know the exact relationship between the NAIRU (Non-Accelerating Inflation Rate of Unemployment) and the actual unemployment rate. Therefore, this paper examines the impact of various factors on change in the NAIRU rate using the example of selected OECD countries. The impact of the actual unemployment rate on the NAIRU is analyzed by examining the presence of hysteresis in unemployment rates, while the second part of the analysis examines the impact of the longterm unemployment rate and trade union density on the NAIRU. The results show that the hysteresis hypothesis is confirmed in almost all the countries when the analysis is applied to the individual, but not to the panel data. On the other hand, changes in the rate of the long term unemployed explain a high percentage of change in the NAIRU, while the impact of the trade union density varies considerably from country to country. The main conclusion is that institutional reforms, which affect the labour market and especially the sources of long-term unemployment, might be successful in the reduction of unemployment rate and its fluctuations.(original abstract)
Accessibility
The Main Library of the Cracow University of Economics
The Library of Warsaw School of Economics
The Library of University of Economics in Katowice
The Main Library of Poznań University of Economics and Business
The Main Library of the Wroclaw University of Economics
Full text
Show
Bibliography
Show
  1. Ball, L., Hysteresis in Unemployment: Old and New Evidence, Working Paper No. 14818, NBER, 2009.
  2. Ball, L., Mankiw, G., The NAIRU in Theory and Practice, "Journal of Economic Perspectives", 16 (4), pp. 115-136, 2002.
  3. Berger, T., Everaert, G., Unemployment Persistence and the NAIRU: A Bayesian Approach, "Scottish Journal of Political Economy", 55 (3), pp. 281-299, 2008.
  4. Blanchard, O., Summers, L., Hysteresis and the European Unemployment Problem, "Macroeconomics Annual", No. 1., NBER, 1986.
  5. Blanchard, O., Summers, L., Beyond the Natural Rate Hypothesis, "American Economic Review", 78, pp. 182-187, 1988.
  6. Blouin, N., To Measure the Unobservable: A Model of the U.S. NAIRU, Working Paper 2007- 02, Department of Finance Canada, 2007.
  7. Bozani, V., Drydakis, N., Studying the NAIRU and its Implications, Discussion Paper No. 6079, The Institute for the Study of Labor, 2011.
  8. Choi, I., Unit Root Tests for Panel Data, "Journal of International Money and Finance", 20, pp. 249-272, 2001.
  9. Chou, H. C., Zhang, Y.C., Unemployment Hysteresis in G20 Countries: Evidence From Non-linear Panel Unit-root Tests, "African Journal of Business Management", 6 (49), pp. 11887-11890, 2012.
  10. Dickey, A. D., Fuller, W. A., Distribution of the Estimators for Autoregresive Time Series With a Unit Root, "Journal of the American Statistical Association", 74 (366), pp. 427-431, 1979.
  11. Ener, M., Arica, F., Unemployment Hysteresis in Turkey and 15 EU Countries: A Panel Approach, "Research Journal of Economics, Business and ICT", 1, pp. 65-71, 2011.
  12. European Economy, Impact of the Current Economic and Financial Crisis on Potential Output, Occasional Papers, No. 49, European Commission, 2009.
  13. Friedman, M., Inflation and Unemployment, Nobel Memorial Lecture, December 13, 1976.
  14. Furceri, D., Mourougane, A., How do Institutions Affect Structural Unemployment in Times of Crises?, Working Paper, No. 730, OECD Economic Department, 2009.
  15. Gianella, C., Koske, I., Rusticelli, E., Chantal, O., What Drives the NAIRU? Evidence From a Panel of OECD Countries, Working Paper, No.649, OECD Economics Department, 2008.
  16. Granger, C. W. J., Investigating Causal Relations by Econometric Models and Cross-spectral Methods, "Econometrica", 37 (3), pp. 424-438, 1969.
  17. Guichard, S., Rusticelli, E., Reassessing the NAIRUs after the Crisis, Working Paper, No. 918, OECD Economics Department, 2011.
  18. Gustavsson, M., Österholm, P., Hysteresis and Non-linearities in Unemployment Rates, "Applied Economics Letters", Vol. 13, Issue 9, pp. 545-548, 2006.
  19. Hodrick, R. J., Prescott, E. C., Postwar U.S. Business Cycles: An Empirical Investigation, Discussion Paper, No. 451, Northwestern University, 1981.
  20. Holden, S., Wulfsberg, F., Downward Nominal Wage Rigidity in the OECD, Working Paper No. 777, European Central Bank, 2007.
  21. Im, K. S., Pesaran, M. H., Shin, Y., Testing for Unit Roots in Heterogeneous Panels, "Journal of Econometrics", 115, pp. 53-74, 2003.
  22. Khim-Sen Liew, V., Chee-Jiun Chia, R., Chin-Hong, P., Does Hysteresis in Unemployment Occur in OECD Countries? Evidence for Parametric and Non-Parametric Panel Unit Roots Test, MPRA Paper No. 9915, 2009.
  23. Kwiatkowski, D., Phillips, P. C. B., Schmidt, P., Shin, Y., Testing the Null Hypothesis of Stationarity against the Alternative of a Unit Root, "Journal of Econometrics", 54, pp. 159-178, 1992.
  24. Lavoie, M., The New Consensus on Monetary Policy Seen from a Post-Keynesian Perspective, [in:] Lavoie, M, Seccareccia, M. (eds): Central Banking in the Modern World. Edward Elgar, Cheltenham, UK 2004.
  25. León-Ledesma, M., Unemployment Hysteresis in the US and the EU: A Panel Data Approach, "Bulletin of Economic Research", 54, pp. 95-105, 2002.
  26. Levin, A., Lin, C. F. Chu, C., Unit Root Tests in Panel Data: Asymptotic and Finite-Sample Properties, "Journal of Econometrics", 108, pp. 1-24, 2002.
  27. Loageay, C., Tober, S., Hysteresis and NAIRU in the Euro Area, Working Paper No. 4/2005, Macroeconomic Policy Institute, 2005.
  28. Maddala, G. S.,Wu S., A Comparative Study of Unit Root Tests with Panel Data and a New Simple Test, "Oxford Bulletin of Economics and Statistics", 61, pp. 631-652, 1999.
  29. Micallef, B., A Multivariate Filter to Estimate Potential Output and NAIRU for the Maltese Economy, Working paper No. 05/2014, Central Bank of Malta, 2014.
  30. Mitchell, W. F., Testing For Unit Roots and Persistence in OECD Unemployment Rates, "Applied Economics", 25, pp. 1489-1501, 1993.
  31. Modigliani, F., Papademos, L., Targets for Monetary Policy in the Coming Year, "Brookings Papers on Economic Activity", 1, pp. 141-163, 1975.
  32. Newey, W., West, K., A Simple, Positive Semi-definite, Heteroskedasticity and Autocorrelation Consistent Covariance Matrix, "Econometrica", 55, pp. 703-708, 1987.
  33. Nickel, S., Nunziata, L., Ochel, W., Unemployment in the OECD Since the 1960s. What Do We Know?, "The Economic Journal", 115, Royal Economic Society, pp. 1-27, 2005.
  34. Phelps, E. S., Money-Wage Dynamics and Labor-Market Equilibrium, "Journal of Political Economy", Chicago University Press, pp. 678-711, 1968.
  35. Phillips, P. C. B., Perron, P., Testing for a Unit Root in Time Series Regression, "Biometrika", 75, pp. 335-346, 1988.
  36. Røed, K., Hysteresis in Unemployment, "Journal of Economic Surveys", 11 (4), pp. 389-418, 1997.
  37. Snowdon, B., Vane, B., Modern Macroeconomic - Its Origins, Development and Current State. Edward Elgar, UK 2005.
  38. Song, F. M., Wu, Y., Hysteresis Unemployment: Evidence from OECD Countries, "The Quarterly Review of Economics and Finance", 38, pp. 181-192, 1998.
  39. Sørensen, P. B., Whitta-Jacobsen, H. J., Introducing Advanced Macroeconomics: Growth and Business Cycles. The 2nd Edition, McGraw-Hill Education, 2010.
  40. Stiglitz, J., Reflections on the Natural Rate Hypothesis, "Journal of Economic Perspectives", 11 (1), pp. 3-10, 1997.
  41. Stockhammer, E., Is There an Equilibrium Rate of Unemployment in the Long Run?, "Review of Political Economy", 16 (1), pp. 59-77, 2004.
  42. Tobin, J., The Stabilisation Policy Ten Years After, "Brookings Papers on Economic Activity", 1, pp. 19-71, 1980.
  43. Tobin, J., Supply Constraints on Employment and Output: NAIRU Versus Natural Rate, Discussion Paper No. 1150, Cowles Foundation, 1997.
  44. Tulip, P., Do Minimum Wages Raise the NAIRU?, "Topics in Macroeconomics", 4, Article 7, pp. 1-34, 2004.
  45. http://epp.eurostat.ec.europa.eu
  46. http://stats.oecd.org/
Cited by
Show
ISSN
1233-5835
Language
eng
URI / DOI
http://dx.doi.org/10.15611/aoe.2016.1.04
Share on Facebook Share on Twitter Share on Google+ Share on Pinterest Share on LinkedIn Wyślij znajomemu