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The ins and outs of European unemployment

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  • Barbara Petrongolo
  • Christopher Pissarides

Abstract

In this paper we study the contribution of inflows and outflows to the dynamics of unemployment in three European countries, the United Kingdom, France and Spain. We compare performance in these three countries making use of both administrative and labor force survey data. We find that the impact of the 1980s reforms in Britain is evident in the contributions of the inflow and outflow rates. The inflow rate became a bigger contributor after the mid 1980s, although its significance subsided again in the late 1990s and 2000s. In France the dynamics of unemployment are driven virtually entirely by the outflow rate, which is consistent with a regime with strict employment protection legislation. In Spain, however, both rates contribute significantly to the dynamics, very likely as a consequence of the prominence of fixed-term contracts since the late 1980s.

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File URL: http://eprints.lse.ac.uk/3658/
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Bibliographic Info

Paper provided by London School of Economics and Political Science, LSE Library in its series LSE Research Online Documents on Economics with number 3658.

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Length: 17 pages
Date of creation: Feb 2008
Date of revision:
Handle: RePEc:ehl:lserod:3658

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Related research

Keywords: [1] Allard; Gayle. 2005. “Measuring Job Security Over Time: In Search of a Historical Indicator”; Instituto de Empressa Working Paper WP-05. (Available from http://www.ie.edu/eng/claustro/claustro_working_papers.asp?ano=2005&tipo=1) [2] Elsby; Michael; Ryan Michaels and Gary Solon. 2007. “The Ins and Outs of Cyclical Unemployment”; mimeo; University of Michigan. [3] Fujita; Shigeru and Garey Ramey. 2007. “The Cyclicality of Separation and Job Finding Rates”; Working Paper no. 07-19; Federal Reserve Bank of Philadelphia. Forthcoming in the International Economic Review. [4] Gomes; Pedro. 2007. “Labour Market Flows in the United Kingdom”; Discussion Paper; Bank of England; forthcoming. [5] Pissarides; Christopher A. 1986. “Unemployment and Vacancies in Britain”; Economic Policy vol. 3; 499-559. [6] Shimer; Robert. 2007. “Reassessing the Ins and Outs of Unemployment”; mimeo; University of Chicago. [7] Yashiv; Eran. 2006. “US Labor Market Dynamics Revisited”; IZA Discussion Paper no. 2445; IZA; Bonn.;

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  1. Yashiv, Eran, 2006. "U.S. Labor Market Dynamics Revisited," IZA Discussion Papers 2455, Institute for the Study of Labor (IZA).
  2. Michael W. Elsby & Ryan Michaels & Gary Solon, 2007. "The Ins and Outs of Cyclical Unemployment," NBER Working Papers 12853, National Bureau of Economic Research, Inc.
  3. Shigeru Fujita & Garey Ramey, 2007. "The cyclicality of separation and job finding rates," Working Papers 07-19, Federal Reserve Bank of Philadelphia.
  4. Shigeru Fujita & Garey Ramey, 2007. "Reassessing the Shimer facts," Working Papers 07-2, Federal Reserve Bank of Philadelphia.
  5. Robert Shimer, 2012. "Reassessing the Ins and Outs of Unemployment," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 15(2), pages 127-148, April.
  6. Gomes, Pedro Maia, 2010. "Labour Market Flows: Facts from the United Kingdom," IZA Discussion Papers 5327, Institute for the Study of Labor (IZA).
  7. Gayle Allard, 2005. "Measuring job security over time: in search of a historical indicator for EPL," Working Papers Economia wp05-17, Instituto de Empresa, Area of Economic Environment.
  8. Ramey, Garey & Shigeru Fujita, 2006. "The Cyclicality of Job Loss and Hiring," University of California at San Diego, Economics Working Paper Series qt4nz8p839, Department of Economics, UC San Diego.
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