Is There A Stable Long-run Relationship Between Unemployment And Productivity?
This paper assesses whether productivity and unemployment have a stable long-run relationship. We explore a panel of 19 OECD countries between 1970 and 2012 and rely on recently developed time series econometric methods. Our findings suggest that unemployment and productivity are non-stationary in l...
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| Format: | Article |
| Language: | English |
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Lodz University Press
2015-06-01
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| Series: | Comparative Economic Research |
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| Online Access: | https://czasopisma.uni.lodz.pl/CER/article/view/7069 |
| Summary: | This paper assesses whether productivity and unemployment have a stable long-run relationship. We explore a panel of 19 OECD countries between 1970 and 2012 and rely on recently developed time series econometric methods. Our findings suggest that unemployment and productivity are non-stationary in levels and in many individual cases these series are cointegrated, even after accounting for possible structural breaks. For many individual countries the long-run effect seems to be generally positive. There is also evidence of two-way causality, but the stronger directional relationship runs from unemployment to productivity. |
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| ISSN: | 1508-2008 2082-6737 |