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The revealed cost of unemployment

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  • Stratford Douglas
  • Howard J. Wall

Abstract

The costs of unemployment usually are stated in terms of the amount of aggregate income that is foregone because of resources left idle. Although useful, this method does not provide all of the information necessary for normative analysis. In this article, Stratford Douglas and Howard J. Wall propose an alternative that measures the cost of regional and national unemployment by the amount that people would be willing to pay to avoid it. The authors' model treats unemployment as a region-specific disamenity, and uses regional cross-migration data to reveal preferences towards income and unemployment.

Suggested Citation

  • Stratford Douglas & Howard J. Wall, 2000. "The revealed cost of unemployment," Review, Federal Reserve Bank of St. Louis, vol. 82(Mar), pages 1-10.
  • Handle: RePEc:fip:fedlrv:y:2000:i:mar:p:1-10:n:v.82no.2
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    References listed on IDEAS

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    Cited by:

    1. Byron Gangnes, 2010. "The Employment Effects of Fiscal Policy: How Costly are ARRA Jobs?," Working Papers 2010-16, University of Hawaii Economic Research Organization, University of Hawaii at Manoa.

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