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Are Labor Force Participation Rates Really Non-Stationary? Evidence from Three OECD Countries

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Author Info

  • Zeynel Abidin Ozdemir

    ()
    (Department of Economics, Gazi University)

  • Mehmet Balcilar

    ()
    (Department of Economics, Eastern Mediterraen University)

  • Aysit Tansel

    ()
    (Department of Economics, METU)

Abstract

This paper shows that the structural breaks are an important characteristic of the monthly labor force participation rate (LFPR) series of Australia, Canada and the USA. Therefore we allow for endogenously determined multiple structural breaks in the empirical specifications of fractionally integrated ARMA model. The findings indicate that contrary to the previous research the LFPRs of Australia, Canada and the USA are stationary implying that the informational value of the unemployment rates about the behavior of labor markets and the causes of joblessness are useful.

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File URL: http://www.erc.metu.edu.tr/menu/series12/1206.pdf
File Function: First version, 2012
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Bibliographic Info

Paper provided by ERC - Economic Research Center, Middle East Technical University in its series ERC Working Papers with number 1206.

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Length: 20 pages
Date of creation: Aug 2012
Date of revision: Aug 2012
Handle: RePEc:met:wpaper:1206

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Keywords: Labor Force Participation Rates; Structural Change; Stationarity;

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  5. Zeynel Abidin Ozdemir & Mehmet Balcilar & Aysit Tansel, 2013. "International Labour Force Participation Rates By Gender: Unit Root Or Structural Breaks?," Bulletin of Economic Research, Wiley Blackwell, vol. 65, pages s142-s164, 05.
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  14. Clemente, Jesus & Montanes, Antonio & Reyes, Marcelo, 1998. "Testing for a unit root in variables with a double change in the mean," Economics Letters, Elsevier, vol. 59(2), pages 175-182, May.
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Cited by:
  1. Aysit Tansel & Zeynel Abidin Ozdemir & Mehmet Balcilar, 2011. "International Labour Force Participation Rates by Gender: Unit Root or Structural Breaks?," Koç University-TUSIAD Economic Research Forum Working Papers 1130, Koc University-TUSIAD Economic Research Forum.

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