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Does Unemployment Hysteresis Equal Employment Hysteresis?

  • Gustavsson, Magnus

    ()

    (Department of Economics)

  • Österholm, Pär

    ()

    (Department of Economics)

This paper investigates if conclusions regarding labour market hysteresis differ depending on whether employment or unemployment rates are studied. Applying a range of unit-root tests to monthly data from Australia, Austria, Canada, Finland, Sweden, the U.K. and the U.S., we find results for employment rates that contrast those based on unemployment rates. In particular, rather than the mixed evidence for hysteresis found using unemployment rates, employment rates result in unequivocal evidence of hysteresis in Australia, Canada and the U.S.. These findings cast doubt on previous conclusions in the literature.

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Paper provided by Uppsala University, Department of Economics in its series Working Paper Series with number 2006:15.

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Length: 27 pages
Date of creation: 10 Jul 2006
Date of revision:
Publication status: Published in Economic Record, 2007, pages 159-173.
Handle: RePEc:hhs:uunewp:2006_015
Contact details of provider: Postal: Department of Economics, Uppsala University, P. O. Box 513, SE-751 20 Uppsala, Sweden
Phone: + 46 18 471 25 00
Fax: + 46 18 471 14 78
Web page: http://www.nek.uu.se/
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