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Regional Origins of Employment Volatility: Evidence from German States

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  • Claudia M. Buch
  • Martin Schlotter

Abstract

Openness for trade can have positive welfare effects in terms of higher growth. But increased openness may also increase uncertainty through a higher volatility of employment. We use regional data from Germany to test whether openness for trade has an impact on volatility. We find a downward trend in the unconditional volatility of employment, which has been interrupted by the re-unification period. Patterns are similar to those for output volatility. The conditional volatility of employment, measuring idiosyncratic developments across states, in contrast, has remained fairly unchanged. In contrast to evidence for the US, we do not find evidence for a significant link between employment volatility and trade openness.

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Bibliographic Info

Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 2296.

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Date of creation: 2008
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Handle: RePEc:ces:ceswps:_2296

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Keywords: employment volatility; trade openness; regional labour markets;

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Cited by:
  1. Jaanika Meriküll & Tairi Rõõm, . "Are foreign-owned firms different ? Comparision of employment volatility and elasticity of labour demand," Bank of Estonia Working Papers, Bank of Estonia wp2014-1, Bank of Estonia.
  2. Ben Salha, Ousama, 2013. "Does economic globalization affect the level and volatility of labor demand by skill? New insights from the Tunisian manufacturing industries," Economic Systems, Elsevier, Elsevier, vol. 37(4), pages 572-597.

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