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

  • Zeynel Abidin Ozdemir

    ()

    (Department of Economics, Gazi University)

  • Mehmet Balcilar

    ()

    (Department of Economics, Eastern Mediterraen University)

  • Aysit Tansel

    ()

    (Department of Economics, METU)

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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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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  7. Granger, Clive W.J. & Hyung, Namwon, 1999. "Occasional Structural Breaks and Long Memory," University of California at San Diego, Economics Working Paper Series qt4d60t4jh, Department of Economics, UC San Diego.
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  16. Jakob Madsen & Vinod Mishra & Russell Smyth, 2008. "Are Labour Force Participation Rates Non-Stationary? Evidence From 130 Years For G7 Countries ," Australian Economic Papers, Wiley Blackwell, vol. 47(2), pages 166-189, 06.
  17. Lobato, Ignacio N & Savin, N E, 1998. "Real and Spurious Long-Memory Properties of Stock-Market Data: Reply," Journal of Business & Economic Statistics, American Statistical Association, vol. 16(3), pages 280-83, July.
  18. Zeynel Abidin Ozdemir & Mehmet Balcilar & Aysit Tansel, 2011. "International Labour Force Participation Rates by Gender: Unit Root or Structural Breaks?," ERC Working Papers 1105, ERC - Economic Research Center, Middle East Technical University, revised Oct 2011.
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