Patterns of Unemployment: An Insider-Outsider Analysis
AbstractThe paper presents a stochastic insider-outsider model that accounts for the following stylized facts: (1) unemployment rates display a high degree of serial correlation, or `persistence'; (2) the average rate of unemployment has been higher in the United States than in Europe over the 1950s and 1960s, but the opposite has been the case in the 1980s; and (3) the long-run unemployment rate is independent of the level of productivity and the magnitude of the labour force. The model also generates other empirically testable hypotheses, concerning cyclical variations in unemployment persistence, the influence of firing costs and the `discouraged worker' effect on unemployment persistence, and the effect of barriers to the entry of firms on the long-run unemployment rate.
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Bibliographic InfoPaper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 960.
Date of creation: Jul 1994
Date of revision:
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Other versions of this item:
- Lindbeck, A. & Snower, D.J., 1992. "Patterns of Unemployment : An Insider-Outsider Analysis," Papers 520, Stockholm - International Economic Studies.
- Lindbeck, A. & Snower, D.J., 1992. "Patterns of Unemployment: An Insider-Outsider Analysis," Discussion Papers 1992_14, Columbia University, Department of Economics.
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
- J32 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Nonwage Labor Costs and Benefits; Retirement Plans; Private Pensions
- J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy
- J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
- J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
- J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy
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- Muysken, Joan & Zwick, Thomas, 2000. "Wage divergence and unemployment: the impact of insider power and training costs," ZEW Discussion Papers 00-37, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
- Peijie Wang, 2003. "Cycles and Common Cycles in Property and Related Sectors," International Real Estate Review, Asian Real Estate Society, vol. 6(1), pages 22-42.
- Mike Campbell, 2000. "Reconnecting the Long Term Unemployed to Labour Market Opportunity: The Case for a 'Local Active Labour Market Policy'," Regional Studies, Taylor & Francis Journals, vol. 34(7), pages 655-668.
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