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Testing for hysteresis in unemployment in OECD countries. New evidence using stationarity panel tests with breaks†

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Abstract

This paper tests hysteresis effects in unemployment using panel data for 19 OECD countries covering the period 1956-2001. The tests exploit the cross-section variations of the series, and additionally, allow for a different number of endogenous breakpoints in the unemployment series. The critical values are simulated based on our specific panel sizes and time periods. The findings stress the importance of accounting for exogenous shocks in the series and give support to the natural-rate hypothesis of unemployment for the majority of the countries analyzed.

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Paper provided by Centro de Estudios Andaluces in its series Economic Working Papers at Centro de Estudios Andaluces with number 2004/40.

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Length: 29 pages
Date of creation: 2004
Date of revision:
Handle: RePEc:cea:doctra:e2004_40

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Cited by:
  1. Thomas Maag, 2008. "Economic Correlates of Suicide Rates in OECD Countries," KOF Working papers 08-207, KOF Swiss Economic Institute, ETH Zurich.

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