Bai-Perron Estimates of OECD Natural Rates of Unemployment 1955-2011
ABSTRACT
Bai and Perron’s method for detecting multiple, unknown structural breaks was used to estimate natural rates of unemployment for 19 OECD countries from 1955-2011. Natural rates were lowest in the early period, then, rose in the mid-1970s and early-1980s in most countries. Several countries saw declines in the late-1990s or early-2000s.
Bai and Perron’s method for detecting multiple, unknown structural breaks was used to estimate natural rates of unemployment for 19 OECD countries from 1955-2011. Natural rates were lowest in the early period, then, rose in the mid-1970s and early-1980s in most countries. Several countries saw declines in the late-1990s or early-2000s.
Cite this paper
Shannon, M. and Moazzami, B. (2014) Bai-Perron Estimates of OECD Natural Rates of Unemployment 1955-2011. iBusiness, 6, 143-149. doi: 10.4236/ib.2014.63015.
Shannon, M. and Moazzami, B. (2014) Bai-Perron Estimates of OECD Natural Rates of Unemployment 1955-2011. iBusiness, 6, 143-149. doi: 10.4236/ib.2014.63015.
References
[1] Bai, J. and Perron, P. (1998) Estimating and Testing Linear Models with Multiple Structural Breaks. Econometrica, 66, 47-78.
http://dx.doi.org/10.2307/2998540 [2] Papell, D., Murray, C. and Ghiblawi, H. (2000) The Structure of Unemployment. Review of Economics and Statistics 82, 309-315.
http://dx.doi.org/10.1162/003465300558696 [3] Laurance, B. and Mankiw, N.G. (2002) The NAIRU in Theory and Practice. Journal of Economic Perspectives, 16, 115-136.
http://dx.doi.org/10.1257/089533002320951000 [4] Laubach, T. (2001) Measuring the Nairu: Evidence from Seven Economies. The Review of Economics and Statistics, 83, 218-231.
http://dx.doi.org/10.1162/00346530151143761 [5] Guichard, S. and Rusticelli, E. (2011) Reassessing the NAIRUs after the Crisis. OECD Economics Department Working Papers No. 918. [6] Blanchard, O. (2006) European Unemployment: The Evolution of Facts and Ideas. Economic Policy, 21, 5-59.
http://dx.doi.org/10.1111/j.1468-0327.2006.00153.x [7] Ljungqvist, L. and Sargent, T. (2008) Two Questions about European Unemployment. Econometrica, 76, 1-29.
http://dx.doi.org/10.1111/j.0012-9682.2008.00816.x [8] Boeri, T. and Garibaldi, P. (2009) Beyond Eurosclerosis. Economic Policy, 406-461. [9] Layard, R., Nickell, S. and Jackman, R. (1994) The Unemployment Crisis. Oxford University Press, Oxford. [10] Bundesagentur für Arbeit 2011 (2002) Amtliche Nachrichten der Bundesagentur für Arbeit.
http://statistik.arbeitsagentur.de/ [11] Burda, M. and Hunt, J. (2011) What Explains the German Labor Market Miracle in the Great Recession? Brookings Paper on Economic Activity, 273-319.
http://dx.doi.org/10.1353/eca.2011.0004 [12] Elliott, G., Rothenberg, T. and Stock, J. (1996) Efficient Tests for an Autoregressive Unit Root. Econometrica, 64, 813-836.
http://dx.doi.org/10.2307/2171846 [13] Perron, P. and Vogelsang, T. (1992) Nonstationarity and Level Shifts with an Application to Purchasing Power Parity. Journal of Business and Economic Statistics, 10, 301-320. [14] Clemente, J., Montanes, A. and Reyes, M. (1998) Testing for a Unit Root in Variables with a Double Change in the Mean. Economic Letters, 59, 175-182.
http://dx.doi.org/10.1016/S0165-1765(98)00052-4 [15] Kerekes, M. (2011) Analyzing Patterns of Economic Growth: A Production Frontier Approach. Unpublished Manuscript.
[1] Bai, J. and Perron, P. (1998) Estimating and Testing Linear Models with Multiple Structural Breaks. Econometrica, 66, 47-78.
http://dx.doi.org/10.2307/2998540 [2] Papell, D., Murray, C. and Ghiblawi, H. (2000) The Structure of Unemployment. Review of Economics and Statistics 82, 309-315.
http://dx.doi.org/10.1162/003465300558696 [3] Laurance, B. and Mankiw, N.G. (2002) The NAIRU in Theory and Practice. Journal of Economic Perspectives, 16, 115-136.
http://dx.doi.org/10.1257/089533002320951000 [4] Laubach, T. (2001) Measuring the Nairu: Evidence from Seven Economies. The Review of Economics and Statistics, 83, 218-231.
http://dx.doi.org/10.1162/00346530151143761 [5] Guichard, S. and Rusticelli, E. (2011) Reassessing the NAIRUs after the Crisis. OECD Economics Department Working Papers No. 918. [6] Blanchard, O. (2006) European Unemployment: The Evolution of Facts and Ideas. Economic Policy, 21, 5-59.
http://dx.doi.org/10.1111/j.1468-0327.2006.00153.x [7] Ljungqvist, L. and Sargent, T. (2008) Two Questions about European Unemployment. Econometrica, 76, 1-29.
http://dx.doi.org/10.1111/j.0012-9682.2008.00816.x [8] Boeri, T. and Garibaldi, P. (2009) Beyond Eurosclerosis. Economic Policy, 406-461. [9] Layard, R., Nickell, S. and Jackman, R. (1994) The Unemployment Crisis. Oxford University Press, Oxford. [10] Bundesagentur für Arbeit 2011 (2002) Amtliche Nachrichten der Bundesagentur für Arbeit.
http://statistik.arbeitsagentur.de/ [11] Burda, M. and Hunt, J. (2011) What Explains the German Labor Market Miracle in the Great Recession? Brookings Paper on Economic Activity, 273-319.
http://dx.doi.org/10.1353/eca.2011.0004 [12] Elliott, G., Rothenberg, T. and Stock, J. (1996) Efficient Tests for an Autoregressive Unit Root. Econometrica, 64, 813-836.
http://dx.doi.org/10.2307/2171846 [13] Perron, P. and Vogelsang, T. (1992) Nonstationarity and Level Shifts with an Application to Purchasing Power Parity. Journal of Business and Economic Statistics, 10, 301-320. [14] Clemente, J., Montanes, A. and Reyes, M. (1998) Testing for a Unit Root in Variables with a Double Change in the Mean. Economic Letters, 59, 175-182.
http://dx.doi.org/10.1016/S0165-1765(98)00052-4 [15] Kerekes, M. (2011) Analyzing Patterns of Economic Growth: A Production Frontier Approach. Unpublished Manuscript.