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Macroeconomic Regimes, Technological Shocks and Employment Dynamics

Listed author(s):
  • Tommaso Ferraresi

    (Università degli Studi di Firenze [Firenze])

  • Andrea Roventini

    (Laboratory of Economics and Management)

  • Willi Semmler

    (New School for Social Research)

In this work we investigate the interrelations among technology, output and employment in the different states of the U.S. economy (recessions vs. expansions). More precisely, we estimate different threshold vector autoregression (TVAR) models with TFP, hours, and GDP, employing the latter as threshold variable, and we assess the ensuing generalized impulse responses of GDP and hours as to TFP shocks. We find that positive productivity shocks, while spurring GDP growth, display a negative effect on hours worked at least on impact, independently of the state of the economy. In the 1957-2011 period, the effects of productivity shocks on employment are abundantly negative in downturns, but they are not significantly different from zero in good times. However, the impact of TFP shocks in different business cycle regimes depends on the chosen sample: after the mid eighties (1984-2011), productivity shocks increase hours during recessions. Finally, we express and test some conjectures that might have caused the changes in the responses in different time periods.

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File URL: http://spire.sciencespo.fr/hdl:/2441/2beljp6noq9u6oh9p9agr8ugra/resources/2016-wp-macroeconomic-regimes-technological-shocks-and-employment-dynamics.pdf
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Paper provided by Sciences Po in its series Sciences Po publications with number 2016-19.

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Date of creation: Jun 2016
Handle: RePEc:spo:wpmain:info:hdl:2441/2beljp6noq9u6oh9p9agr8ugra
Contact details of provider: Web page: http://www.sciencespo.fr/

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