The aim of this paper is to analyze and estimate salient characteristics of unemployment dynamics. Movements in … unemployment are viewed as "chain reactions" of responses to labor market shocks, working their way through systems of interacting … lagged adjustment processes. In the context of estimated labor market systems for Germany, the UK, and the US, we construct …

This paper presents a reappraisal of unemployment movements in the European Union. Our analysis is based on the chain … reaction theory of unemployment, which focuses on (a) the interaction among labor market adjustment processes, (b) the … growth drivers. Estimating a system of labor market equations for a panel of EU countries, we derive the dynamic unemployment …

This paper examines the movements in EU unemployment from two perspectives: (a) the NRU/NAIRU perspective, in which … unemployment movements are attributed largely to changes in the long-run equilibrium unemployment rate and (b) the chain …-reaction perspective, in which unemployment movements are viewed as the outcome of the interplay between labor market shocks and prolonged …

fundamental role in shaping unemployment movements. This role has generally been examined by considering indirect transmission … single-equation unemployment rate models. Here we advocate a different approach. We directly estimate the effects of capital … stock in the labour market by applying the chain reaction theory of unemployment, and we find that capital stock is a major …

The evolution of Spanish unemployment has been quite idiosyncratic. The full employment levels of the early seventies … were followed by unemployment rates that were the highest within the OECD countries in the aftermath of the oil price … shocks. While unemployment was extremely persistent in most of the eighties and nineties, it experienced its sharpest decline …

causes of the unemployment upturn in 1973-1983 and the subsequent decline in 1993-2006. Our results show that (i) the main … determinants of the unemployment rise in the 1970s and early 1980s were wage-push factors, the two oil price shocks and the … increase in interest rates, and (ii) the acceleration in capital accumulation was the crucial driving force of unemployment in …

We reconsider the central role of the natural rate of unemployment (NRU) in forming policy decisions. We show that the … unemployment rate does not gravitate towards the NRU due to frictional growth, a phenomenon that encapsulates the interplay between … empirical analysis and find that the NRU explains only 33% of the unemployment variation, while frictional growth accounts for …

This paper provides a critique of the "unemployment invariance hypothesis," according to which the behavior of the … labor market ensures that the long-run unemployment rate is independent of the size of the capital stock, productivity, and … equilibrating mechanisms to ensure unemployment invariance and that other markets may perform part of the equilibrating process as …

This paper provides a critique of the ?unemployment invariance hypothesis,? according to which the behavior of the … labor market ensures that the long-run unemployment rate is independent of the size of the capital stock, productivity, and … equilibrating mechanisms to ensure unemployment invariance and that other markets may perform part of the equilibrating process as …

This paper challenges what is the standard account of UK unemployment, namely that the major swings in unemployment … over the past 25 years are due predominantly to movements in the underlying empirical “natural rate of unemployment” (NRU … unemployment are due, instead, to very prolonged after-effects of persistent (transitory but long-lasting) shocks. We argue that (a …