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An alternative measure of structural unemployment

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  • Uluc Aysun

    ()
    (University of Central Florida, Orlando, FL)

  • Florence Bouvet

    ()
    (Sonoma State University, Rohnert Park, CA)

  • Richard Hofler

    ()
    (University of Central Florida, Orlando, FL)

Abstract

In this paper we derive an alternative measure for structural unemployment using a stochastic frontier analysis. This measure, by empirical design, is always less than total unemployment and it is, thus, more consistent with the theoretical description of structural unemployment than its usual interpretation as a smoothed long-run average of total unemployment. We find that our measure does not always track the long-run trends in total unemployment in the U.S. and when compared to the existing measures can produce different insights about the evolution of structural unemployment. Demographic and regional evidence provides some validation for our approach and allows us to determine how demographic and regional factors are related to the variation in structural unemployment across time and regions.

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Bibliographic Info

Paper provided by University of Central Florida, Department of Economics in its series Working Papers with number 2012-04.

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Length: 36 Pages
Date of creation: Jul 2012
Date of revision:
Handle: RePEc:cfl:wpaper:2012-04

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Phone: (407) 823-3266
Web page: http://www.bus.ucf.edu/economics/
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Keywords: frictional; cyclical; structural unemployment; stochastic frontier;

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