Why are Canadian and US Unemployment Rates So Highly Correlated?

This file is part of IDEAS, which uses RePEc data

Why are Canadian and US Unemployment Rates So Highly Correlated?

Author Info

Kevin Lang
Jay Zagorsky

Additional information is available for the following registered author(s):

Kevin Lang

Abstract

We examine twin mysteries - the high correlation between Canadian and US unemployment rates and the emergence of a gap between these rates around 1982. We argue that the apparent close relationship between the unemployment rates and the sudden emergence of a gap are statistically spurious, because both rates are highly persistent. When we difference the data, the unemployment rates remain highly correlated but at a plausible level. Moreover, the permanent increase in the gap is not strikingly large compared with other years. This means that there is little reason to limit explanations for the current gap to events in 1982.

Download Info
To download:

If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Publisher Info
Article provided by University of Toronto Press in its journal Canadian Public Policy.

Volume (Year): 24 (1998)
Issue (Month): s1 (February)
Pages: 56-71
Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Handle: RePEc:cpp:issued:v:24:y:1998:i:s1:p:56-71

Contact details of provider:
Postal: University of Toronto Press Journals Division 5201 Dufferin Street Toronto, Ontario, Canada M3H 5T8
Email:
Web page: http://economics.ca/cpp/

Order Information:
Email:
Web: http://www.utpjournals.com/cpp/

For technical questions regarding this item, or to correct its listing, contact: (Prof. Werner Antweiler).

Related research
Keywords:

Other versions of this item:

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

Allan W. Gregory & Bruce E. Hansen, 1992. "Residual-Based Tests for Cointegration in Models with Regime Shifts," Working Papers 862, Queen's University, Department of Economics.
Other versions:
- Gregory, A.W. & Hansen, B.E., 1992. "Residual-Based Tests for Cointegration in Models with Regime Shifts," RCER Working Papers 335, University of Rochester - Center for Economic Research (RCER).
- Gregory, Allan W. & Hansen, Bruce E., 1996. "Residual-based tests for cointegration in models with regime shifts," Journal of Econometrics, Elsevier, vol. 70(1), pages 99-126, January. [Downloadable!] (restricted)
Ross D. Milbourne & Douglas D. Purvis & W. David Scoones, 1991. "Unemployment Insurance and Unemployment Dynamics," Canadian Journal of Economics, Canadian Economics Association, vol. 24(4), pages 804-26, November. [Downloadable!] (restricted)
Other versions:
- Ross D. Milbourne & Douglas D. & W. David Scoones, 1989. "Unemployment Insurance and Unemployment Dynamics," Working Papers 750, Queen's University, Department of Economics.
Green, David A & Riddell, W Craig, 1993. "The Economic Effects of Unemployment Insurance in Canada: An Empirical Analysis of UI Disentitlement," Journal of Labor Economics, University of Chicago Press, vol. 11(1), pages S96-147, January. [Downloadable!] (restricted)
Other versions:
- Green, D.A. & Riddell, W.C., 1992. "The Economic Effects of Unemployment Insurance in Canada: An Empirical Analysis of UI Disentitlement," UBC Departmental Archives 92-15, UBC Department of Economics.
Eric Zivot & Donald W.K. Andrews, 1990. "Further Evidence on the Great Crash, the Oil Price Shock, and the Unit Root Hypothesis," Cowles Foundation Discussion Papers 944, Cowles Foundation, Yale University. [Downloadable!]
Other versions:
- Zivot, Eric & Andrews, Donald W K, 2002. "Further Evidence on the Great Crash, the Oil-Price Shock, and the Unit-Root Hypothesis," Journal of Business & Economic Statistics, American Statistical Association, vol. 20(1), pages 25-44, January.
- Zivot, Eric & Andrews, Donald W K, 1992. "Further Evidence on the Great Crash, the Oil-Price Shock, and the Unit-Root Hypothesis," Journal of Business & Economic Statistics, American Statistical Association, vol. 10(3), pages 251-70, July.
John McCallum, 1987. "Unemployment in Canada and the United States," Canadian Journal of Economics, Canadian Economics Association, vol. 20(4), pages 802-22, November. [Downloadable!] (restricted)
Ashenfelter, Orley & Card, David, 1986. "Why Have Unemployment Rates in Canada and the United States Diverged?," Economica, London School of Economics and Political Science, vol. 53(210(S)), pages S171-95, Supplemen. [Downloadable!] (restricted)
Riddell, W.C. & Card, D., 1992. "A Comparative Analysis of Unemployment in Canada and United States," UBC Departmental Archives 92-07, UBC Department of Economics.
David Card & W. Craig Riddell, 1993. "A Comparative Analysis of Unemployment in Canada and the United States," NBER Chapters, in: Small Differences That Matter: Labor Markets and Income Maintenance in Canada and the United States, pages 149-190 National Bureau of Economic Research, Inc. [Downloadable!]
Other versions:
- David Card, 1992. "A Comparative Analysis of Unemployment in Canada and the United States," Working Papers 677, Princeton University, Department of Economics, Industrial Relations Section.. [Downloadable!]
Stefan F. Kaliski, 1987. "Accounting for Unemployment--A Labour Market Perspective," Canadian Journal of Economics, Canadian Economics Association, vol. 20(4), pages 665-93, November. [Downloadable!] (restricted)
De Long, J Bradford & Lang, Kevin, 1992. "Are All Economic Hypotheses False?," Journal of Political Economy, University of Chicago Press, vol. 100(6), pages 1257-72, December. [Downloadable!] (restricted)
Other versions:
- J. Bradford De Long & Kevin Lang, . "Are All Economic Hypotheses False?," J. Bradford De Long's Working Papers _117, University of California at Berkeley, Economics Department. [Downloadable!]

Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

Manfred Keil & Louis Pantuosco, 1998. "Canadian and US Unemployment Rates: A Comparison Based on Regional Data," Canadian Public Policy, University of Toronto Press, vol. 24(s1), pages 38-55, February. [Downloadable!] (restricted)

Statistics

Access and download statistics

Did you know? About five million pdf files are downloaded through RePEc every year.

This page was last updated on 2009-12-9.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.