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Unemployment and labor force participation in the United States

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  • Emerson, Jamie
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    Abstract

    This paper uses historical data from the United States to investigate the relationship between unemployment and labor force participation. Cointegration analysis supports a long-run relationship between these two variables, which leads us to question the empirical relevance of the unemployment invariance hypothesis for the United States.

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    File URL: http://www.sciencedirect.com/science/article/pii/S0165176511000723
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    Bibliographic Info

    Article provided by Elsevier in its journal Economics Letters.

    Volume (Year): 111 (2011)
    Issue (Month): 3 (June)
    Pages: 203-206

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    Handle: RePEc:eee:ecolet:v:111:y:2011:i:3:p:203-206

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    Web page: http://www.elsevier.com/locate/ecolet

    Related research

    Keywords: Cointegration Discouraged worker Unemployment invariance hypothesis;

    References

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    1. Österholm, Pär, 2009. "Unemployment and Labour Force Participation in Sweden," Working Paper 113, National Institute of Economic Research.
    2. Kwiatkowski, Denis & Phillips, Peter C. B. & Schmidt, Peter & Shin, Yongcheol, 1992. "Testing the null hypothesis of stationarity against the alternative of a unit root : How sure are we that economic time series have a unit root?," Journal of Econometrics, Elsevier, vol. 54(1-3), pages 159-178.
    3. Layard, Richard & Nickell, Stephen & Jackman, Richard, 2005. "Unemployment: Macroeconomic Performance and the Labour Market," OUP Catalogue, Oxford University Press, number 9780199279173.
    4. Murphy, Kevin M & Topel, Robert H, 1997. "Unemployment and Nonemployment," American Economic Review, American Economic Association, vol. 87(2), pages 295-300, May.
    5. Graham Elliott & Thomas J. Rothenberg & James H. Stock, 1992. "Efficient Tests for an Autoregressive Unit Root," NBER Technical Working Papers 0130, National Bureau of Economic Research, Inc.
    6. Marika Karanassou & Dennis J. Snower, 2004. "Unemployment Invariance," German Economic Review, Verein für Socialpolitik, vol. 5(3), pages 297-317, 08.
    7. Gustavsson, Magnus & Osterholm, Par, 2006. "The informational value of unemployment statistics: A note on the time series properties of participation rates," Economics Letters, Elsevier, vol. 92(3), pages 428-433, September.
    8. Johansen, Soren, 1988. "Statistical analysis of cointegration vectors," Journal of Economic Dynamics and Control, Elsevier, vol. 12(2-3), pages 231-254.
    9. Johansen, Soren, 1991. "Estimation and Hypothesis Testing of Cointegration Vectors in Gaussian Vector Autoregressive Models," Econometrica, Econometric Society, vol. 59(6), pages 1551-80, November.
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    Cited by:
    1. John K. Dagsvik & Tom Kornstad & Terje Skjerpen, 2010. "Labor force participation and the discouraged worker effect," Discussion Papers 642, Research Department of Statistics Norway.
    2. Makoto Kakinaka & Hiroaki Miyamoto, 2012. "Unemployment and labour force participation in Japan," Applied Economics Letters, Taylor & Francis Journals, vol. 19(11), pages 1039-1043, July.
    3. Cengiz, Sibel & Sahin, Afsin, 2013. "Modelling Nonlinear Behavior of Labor Force Participation Rate by STAR: An Application for Turkey," MPRA Paper 47805, University Library of Munich, Germany, revised 07 May 2013.
    4. Ozerkek, Y., 2013. "Unemployment And Labor Force Participation: A Panel Cointegration Analysis For European Countries," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 13(1), pages 67-76.

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