Change search
ReferencesLink to record
Permanent link

Direct link
Common Trends and Hysteresis in Unemployment
Department of Statistics, Uppsala University.
Department of Economics, Stockholm School of Economics.
Stockholm University, Faculty of Social Sciences, Institute for International Economic Studies.
1994 (English)Report (Other academic)
Abstract [en]

We examine the sources of labor market fluctuations in the Scandinavian countries using VAR models with common trends. Our primary concerns are the sources of hysteresis in unemployment and possible differences between the economies. A simple economic model is presented to motivate our identifying assumptions. We show how estimates of the theoretical parameters may be obtained from the estimated common trends coefficients. The empirical results suggest that (i) the only common source of hysteresis in the Scandinavian labor markets is shocks to wage setting (or, equivalently, equilibrium unemployment); (ii) transitory labor demand shocks, which are emphasized in the theoretical literature on hysteresis, do not seem to be empirically important.

Place, publisher, year, edition, pages
Stockholm: IIES , 1994. , 46 p.
Seminar Paper / Institute for International Economic Studies, Stockholm University, ISSN 0347-8769 ; 585
Keyword [en]
common trends, hysteresis, identification, structural parameters, supply and demand shocks, unemployment
National Category
URN: urn:nbn:se:su:diva-41910OAI: diva2:342926
Available from: 2010-08-11 Created: 2010-08-11 Last updated: 2010-08-11Bibliographically approved

Open Access in DiVA

fulltext(6625 kB)222 downloads
File information
File name FULLTEXT01.pdfFile size 6625 kBChecksum SHA-512
Type fulltextMimetype application/pdf

By organisation
Institute for International Economic Studies

Search outside of DiVA

GoogleGoogle Scholar
Total: 222 downloads
The number of downloads is the sum of all downloads of full texts. It may include eg previous versions that are now no longer available

Total: 21 hits
ReferencesLink to record
Permanent link

Direct link