aggregate employment and intertemporal substitution in the uk in this paper the author sets up estimates and tests an explicit model of aggregate labor supply based on the intertemporal substitution hypothesis the model is derived as the optimal decision rule of an infinitely living household maximizing an intertemporal ces utility function over consumption and leisure the evidence suggests that for aggregate employee hours the model is rejected but that for the total number of employees in employment the estimates are broadly consistent with the theory the assumed constant elasticity of substitution is estimated at around 0 2 and this estimate implies a short run real wage and real interest rate elasticity of labor supply of the same order copyright 1987 by royal economic society

the aggregate labour market an empirical investigation into market clearing for the uk a two equation model of the aggregate labor market is presented as part of a larger market clearing macroeconomic framework which is then estimated by a suitable subsystem estimator using annual data for the u k 1948 1979 taken on their own theory consistent estimates of both labor supply and labor demand are obtained the maintained hypothesis that the market clears cannot be tested againsta more general structural model within the framework presented however a test of the model against the data generation process suggests that the maintained hypothesis is untenable after 1966 which is confirmed by evidence of dynamic instability copyright 1987 by royal economic society

artificial adaptive agents in economic theory economic analysis has largely avoided questions about the way in which economic agents make choices when confronted by a perpetually novel and evolving world as a result there are outstanding questions of great interest to economics in areas ranging from technological innovation to strategic learning in games this is so despite the importance of the questions because standard tools and formal models are ill tuned for answering such questions however recent advances in computer based modeling techniques and in the subdiscipline of artificial intelligence called machine learning offer new possibilities artificial adaptive agents aaa can be defined and can be tested in a wide variety of artificial worlds that evolve over extended periods of time the resulting complex adaptive systems can be examined both computationally and analytically offering new ways of experimenting with and theorizing about adaptive economic agents many economic systems can be classified as complex adaptive systems such a system is complex in a special sense i it consists of a network of interacting agents processes elements ii it exhibits a dynamic aggregate behavior that emerges from the individual activities of the agents and iii its aggregate behavior can be described without a detailed knowledge of the behavior of the individual agents an agent in such a system is adaptive if it satisfies an additional pair of criteria the actions of the agent in its environment can be assigned a value performance utility payoff fitness or the like and the agent behaves so as to increase this value over time a complex adaptive system then is a complex system containing adaptive agents networked so that the environment of each adaptive agent includes other agents in the system complex adaptive systems usually operate far from a global optimum or attractor such systems exhibit many levels of aggregation organization and interaction each level having its own time scale and characteristic behavior any given level can usually be described in terms of local niches that can be exploited by particular adaptations the niches are various so it is rare that any given agent can exploit all of them as rare as finding a universal competitor in a tropical forest moreover niches are continually created by new adaptations it is because of this ongoing evolution of the niches and the perpetual novelty that results that the system operates far from any global attractor improvements are always possible and indeed occur regularly the everexpanding range of technologies and products in an economy or the everimproving strategies in a game like chess provide familiar examples adaptive systems may settle down temporarily at a local optimum where performance is good in a comparative sense but they are usually uninteresting if they remain at that optimum for an extended period a theory of complex adaptive systems based on aaa makes possible the development of well defined yet flexible models that exhibit emergent behavior such models can capture a wide range of economic phenomena precisely even though the development of a general mathematical theory of complex adaptive systems is still in its early stages the aaa models complement current theoretical directions they are

intertemporal substitution taste shocks and cointegration abstract the intertemporal elasticity of substitution is estimated by cointegrating regressions for the u s a the u k switzerland and west germany the results of this approach which is robust with respect to stationary taste shocks indicate a substantial extent of intertemporal substitution

sectoral shocks and aggregate fluctuations abstract this paper presents a multisector dynamic general equilibrium model of business cycles with a distinctive feature aggregate fluctuations are driven by independent sectoral shocks the model hypothesizes that trade among sectors provides a strong synchronization mechanism for these shocks due to the limited but locally intense interaction that is characteristic of such input trade flows limited interaction characterized by a sparse intermediate input use matrix reduces substitution possibilities among intermediate inputs which strengthens comovement in sectoral value added and leads to a postponement of the law of large numbers in the variance of aggregate value added the chief virtue of this model is that reliance on implausible aggregate shocks is not necessary to capture the qualitative features of macroeconomic fluctuations building on horvath 1998 review of economic dynamics 1 781 808 which establishes the theoretical foundation for the relevance of limited interaction in the context of a stylized multisector model this paper specifies a more general multisector model calibrated to the us 2 digit standard industrial code economy simulations prove the model is able to match empirical reality as closely as standard one sector business cycle models without relying on aggregate shocks

inventories rational expectations and the business cycle abstract the simplest macroeconomic models in which markets clear instantaneously and expectations are rational preclude the existence of business cycles that is of serially correlated deviations of output from trend this paper studies one of several mechanisms that can be used to make these so called new classical models produce business cycles the mechanism is the gradual adjustment of inventory stocks two macroeconomic models of inventory holdings are formulated both imply first that current output should be a decreasing function of the stock of inventories and second that inventories once perturbed from equilibrium levels should adjust only gradually these two features are then embedded into an otherwise standard macroeconomic model in which markets clear instantaneously and expectations are rational two principal conclusions are reached first disturbances such as unanticipated changes in money will set in motion serially correlated deviations of output from trend second if desired inventories are sensitive to the real interest rate then even fully anticipated changes in money can affect real variables

oil vulnerability index of oil importing countries abstract this paper assesses the relative oil vulnerability of 26 net oil importing countries for the year 2004 on the basis of various indicators the ratio of value of oil imports to gross domestic product gdp oil consumption per unit of gdp gdp per capita and oil share in total energy supply ratio of domestic reserves to oil consumption exposure to geopolitical oil market concentration risks as measured by net oil import dependence diversification of supply sources political risk in oil supplying countries and market liquidity the approach using the principal component technique has been adopted to combine these individual indicators into a composite index of oil vulnerability such an index captures the relative sensitivity of various economies towards developments of the international oil market with a higher index indicating higher vulnerability the results show that there are considerable differences in the values of individual indicators of oil vulnerability and overall oil vulnerability index among the countries both inter and intraregional

quantifying china s oil import risks and the impact on the national economy abstract with an increase in china s oil imports china s oil supply will also continue to be effected by the socio economic stability of oil exporting countries and the safety of oil transport routes this paper introduces a systematic and quantitative method to evaluate the influence of china s oil import risks oir on the national economy and industrial sectors from a perspective of apply chain process for this analysis china s oir is quantified by integrating oil exporting country risk and the risks from oil transportation routes country risk is defined as the oil exporting country s political risk caused by political changes or internal conflicts transport risk is defined as the risk of shipping routes affected by pirate attacks and geopolitics second the relationship between china s oir and oil import costs is analyzed using a multiple linear approach third an input output analysis method is used to research the effect of the cost of china s oil imports on the cost of investment within china s domestic sectors this research finds that the corresponding impact on gdp is 3494 5 million dollars given an increasing by 10 of china s oir and the impact on domestic sectors differs from sector to sector finally this paper puts forth recommendations to improve long term oil supply security in china

estimating the intertemporal elasticity of labor supply in a contractual market abstract if labor services are exchanged in contractual markets existing micro estimates of the intertemporal substitution elasticity contain a negative bias hedonic wage regressions of compensating differentials for layoffs provide unbiased estimates in contractual markets

on intertemporal substitution and aggregate labor supply in this paper the author presents an econometric investigation of t he implications of the intertemporal substitution hypothesis for aggregate employment in the united states the tests are based on a version of the hypothesis with time separable preferences on the basis of the evidence produced the hypothesis is quite successful in explaining fluctuations in aggregate employment although almost totally unsuccessful in accounting for fluctuations in employee hours these findings suggest that the hypothesis might have an important role to play in macroeconomic modeling although they contradict attempts to account for aggregate fluctuations solely in terms of continuous competitive equilibrium in labor markets copyright 1987 by university of chicago press

implicit contracts life cycle labor supply and intertemporal substitution the implicit contract model is a serious alternative to the spot market interpretation of the labor market however its usefulness has been limited because the wage is unobserved and hence it has not been possible to estimate an intertemporal frisch supply elasticity for the model using microdata in this article we show that one can estimate this elasticity from microdata within the context of the implicit contract model under relatively weak assumptions based on consumer theory we implement our approach on two micro data sets and for both obtain a reasonably precise elasticity estimate of approximately 1 0

married womens tastes and the decision to participate in the labour market results from a fixed effects model in the paper we report estimates from two logit models of women s labour force participation a model with out fixed effects estimated from cross sectional data indicates a significant postive relation between work experience and particiption we ask whether the relation is due to a causal influence extered by the former variable on the latter or to a common underlying variable taste for market attachement to answer this question we present results from a fixed effects model estimated from panel data in this model the estimated coefficients of experience are insignificant suggestion that a taste for market attachement underlies both experience and participation is the presence of preschool children

a time series analysis of representative agent models of consumption andleisure choice under uncertainty this paper investigates empirically a model of aggregate consumption and leisure decisions in which utility from goods and leisure is nontime separable the nonseparability of preferences accommodates intertemporal substitution or complementarity of leisure and thereby affects the comovements in aggregate compensation and hours worked these cross relations are examined empirically using postwar monthly u s data on quantities real wages and the real return on the one month treasury bill the estimated values of the parameters governing preferences differ significantly from the values assumed in several studies of real business models several possible explanations of these discrepancies are discussed

habits hysteresis and catastrophes in labor supply abstract this paper investigates the implications of a general model of locally unstable habit formation with respect to consumption household time and corporate time the model is shown to imply multiple long run equilibria exhibiting hysteresis and catastrophes dependent on rationings and the wage rate this can explain profound changes in labor supply preferences and behavior such as when long term unemployed become little motivated to get a new job or when former housewives develop a strong orientation towards paid work

weekly employee hours weeks worked and intertemporal substitution abstract we show that the representative consumer model fits the aggregate consumption and employment data well if a choice of work is allowed both at the intensive and extensive margins the structural preference parameters recovered from the estimation of the euler equations of the model are economically meaningful and the null hypothesis of the overidentifying restrictions implied by our model is far from being rejected we find that the shares in preferences associated with leisure time in the weeks off and in the workweeks are quite large and about equal our estimates also uncover relatively large intertemporal substitution elasticities

oil shocks and external balances abstract we provide estimates of the effects of demand and supply shocks in the global crude oil market on several measures of oil exporters and oil importers external balances including the oil trade balance the non oil trade balance the current account capital gains and changes in net foreign assets nfa first we show that the effect of oil demand and supply shocks on the merchandise trade balance and the current account which depending on the source of the shock can be large depends critically on the response of the non oil trade balance our results provide evidence of an intermediate degree of international financial integration second we document the presence of large and systematic valuation effects in response to these shocks valuation effects overall tend to cushion the effect of oil demand and supply shocks on the nfa positions of oil exporters and oil importers third we quantify the overall importance of global business cycle demand shocks as well as oil market specific demand and supply shocks for external balances

oil price shocks and trade imbalances abstract this study aims to examine whether a large part of the variability of trade balances and their oil and non oil components is associated with oil price fluctuations the long run causality running from oil price to overall oil and non oil trade balances and their short run dynamics are investigated by applying the toda and yamamoto 1995 ty causality approach and generalized impulse response functions irfs respectively to the monthly data spanning from january 1999 to november 2011 three asian economies that represent three distinct characteristics in terms of oil are chosen and examined malaysia as an oil exporter singapore as an oil refinery and japan as an oil importer the stability of the causality is also checked and the estimated impulse responses across different periods are examined the results have implications for both policy makers and economic modeling of the impact of oil price shocks

competition transmission and pattern evolution a network analysis of global oil trade abstract this paper studies the competition among oil importers using complex network theory combined with several alternative measures of competition intensity to analyze the evolution of the pattern and transmission of oil trading competition the results indicate that oil trade has formed a global competition pattern and that the role played by the asian pacific region in the evolution of this competition pattern is becoming increasingly prominent in addition global competition intensity has continued to rise and non oecd countries have become the main driving force for this increase in global competition intensity the large oil importers are the most significant parts of the global oil trading competition pattern they are not only the major participants in the competition for oil resources but also play important roles in the transmission of oil trading competition china and the united states especially display the feature of globalization whose impacts of transmission reach across the whole oil trading competition network finally a 5c changeability contestability cooperation commitment and circumstances policy framework is put forward to maintain the stability of oil trade and improve the energy security of oil importers in various aspects

crude oil price fluctuations and saudi arabia s behaviour this study attempts to explain why crude oil prices fluctuate the main cause being the quota regime which characterises the opec agreements given that the saudi oil supply is inelastic in the short term a shock in the oil market is accommodated by an immediate price change by contrast a dominant firm behaviour in the long term causes an output change which is accompanied by a smaller price change this explains why oil prices overshoot the results of a general equilibrium model applied to saudi arabia support this analysis they also indicate that saudi arabia does not have any incentive for altering the crude oil market equilibrium with either positive or negative supply shocks as its welfare declines and that it has an incentive disincentive for intervening if a negative positive demand shock hits the crude oil market a second set of simulations is designed to understand what kind of oecd policy might help to bring down prices a tax cut would worsen the situation whereas policies that can increase the price elasticity of demand seem to be very effective

inflation and labor market adjustment the implications of downward nominal and ex ante real wage rigidity and of wage contracting for the dispersion of relative wage changes in the presence of price inflation are examined rigidity implies that unexpected inflation will raise the variability of relative wage changes contracting implies unexpected inflation reduces variability using data on manufacturing industries for 1955 81 and on private nonfarm industries for1965 81 these hypotheses are studied the dispersion in relative wage cnanges is reduced by greater price inflation most of the reduction is a response to unexpected inflation expected inflation has little impact on dispersion these findings hold for subperiods within the sample and are robust to different choices of measures of price expectations including those of the livingston survey the survey research center household data and arma forecasts they stand in striking contrast to the commonly accepted result that price inflation is associated with greater dispersion of relative price changes they suggest that inflation reduces the ability of relative wages to signal disequilibria among labor markets this abstract was borrowed from another version of this item

determination of employment with wage and price speculation the purpose of this paper is to investigate whether aggregate fluctuations in employment may be explained within a market clearing framework as intertemporal substitution in labor supply and demand an intertemporal substitution model for the firm is derived this model is estimated with a lucas rapping type supply equation empirical results with finnish data lend support to the intertemporal substitution model particularly concerning the demand function specification on the other hand the results for the supply equation are somewhat mixed being rather sensitive to the dynamic specification

output effects of government purchases the theoretical analysis focuses on the distinction between temporary and permanent movements in government purchases under plausible conditions the temporary case involves an output response that is positive less than one to one with the change in government purchases and larger than that generated by an equal sized but permanent shift in purchase the equilibrium real rate of return rise in the temporary case but changes little in the permanent one defense purchases are divided empirically into permanent and temporary components by considering the role of temporary wars no temporary shifts in nondefense purchases were isolated empirical results verify an expansionary output effect for temporary purchases that exceeds that of permanent purchases the results for some other expectational hypotheses are found to be generally supportive of the theory

real wages in the business cycle and the theory of income distribution an unresolved conflict between theory and facts in mainstream macroeconomics the focus of this article is the recurring tension between mainstream macroeconomics and observed facts in connection with the difficult task of providing explanations of the business cycle consistent both with the traditional theory of income distribution and with the empirical evidence concerning the co movements of real wages and employment over the cycle the attempts to reconcile facts and theory have led to the continuous introduction of specific and arguably ad hoc hypotheses in contrast with the search for greater theoretical rigour claimed by the various streams of macroeconomic modelling subsequent to the neo classical synthesis in addition the specific assumptions introduced in the models or their implications are in turn often contradicted or at best not confirmed by subsequent empirical research it is suggested in the conclusions that the difficulty of keeping together in a simple and consistent framework theory and facts reflects the flawed theoretical foundations of mainstream theory

testing between competing models of real business cycles this paper tests a real business cycle model with efficient long term labor contracts the efficient long term contract model against a standard real business cycle model the intertemporal substitution model in the former model employment and real wages are determined by bilateral dynamic bargaining between firms and workers in the latter model employment and real wages are determined instead by the dynamic optimization of households within the competitive market framework we estimate each model using aggregate japanese data our results show that the data are consistent with the efficient long term contract model but are inconsistent with the intertemporal substitution model a business cycle phenomenon is typically found in time series data on employment and real wages according to the data of almost all developed countries employment fluctuations are considerably greater than wage fluctuations many recent economic studies have attempted to explain this phenomenon most of these studies fall into the equilibrium business cycle theory in which business cycles are the result of individual agents optimizing in a competitive environment among the most famous early examples of such a theory are the rational expectations general equilibrium models of lucas 1972 and barro 1976 which stress the role of nominal shocks in the presence of imperfect information more recently the predominant equilibrium business cycle theory has been the real business cycle model of kydland and prescott 1982 long and plosser 1983 and king and plosser 1984 which emphasizes the importance of real shocks to production technology real business cycle theory considers a model economy populated by a single infinitely lived individual with given initial resources production possibilities and tastes the representative individual chooses a preferred consumption production plan and the resulting allocation is pareto optimal the implications of real business cycle theory are thus derived from the pareto optimal equilibrium allocation as calculated from the planning problem of a social planner or representative agent a policy implication of this theory is that monetary policy has no significant effect

product space and the development of nations a model of product diversification abstract hidalgo et al 2007 hidalgo and hausmann 2009 and hausmann and hidalgo 2011 propose an outcome based product space in which development traps can emerge due to low connectivity between products and countries lack of productive capabilities a recent stream of research suggests that this product space can be used as an instrument to guide public policy to assess the potential effects of these policies on an economy s export performance and on the ones of its competitors we build a micro founded simulation model of the evolution of countries positions on the product space we find that export subsidies and polices aiming at improving firm s innovation capabilities can be effective tools for increasing a country export performance however this increase occurs at the expense of competing countries as they support unpredictable changes in the variety of their exports

the impact of energy trade patterns on co2 emissions an emergy and network analysis abstract fossil fuel is considered to be the major cause of co2 emissions and it flows across countries through the international energy trade in this paper we analyse the impact of energy trade patterns on co2 emissions for a global sample from 2000 to 2014 we construct an international fossil fuel trade network based on emergy theory and calculate some corresponding structural parameters then we systematically evaluate the impact of energy trade on co2 emissions from the trade volume and trade relationships perspectives we obtain the following results 1 trade strength mainly affects co2 emissions through the scale effect composition effect and technique effect 2 trade security and trade centre status of one country will significantly affect co2 emissions 3 for high economic level he countries concentrating the trade volume on several finite countries will destroy the environment low economic level le countries that are proximal to the important countries of the energy market will experience an increase in pollution this research also discusses some implications for policy makers

the intertemporal substitution model of labour market fluctuations an empirical analysis the paper uses two approaches to study whether aggregate fluctuations in employment and unemployment may be explained within a market clearing framework as intertemporal substitution in labour supply first log linear equations for labour supply and unemployment are estimated using a forecasting model to measure wage and price expectations second a utility function is used to derive and estimate an equation for labour supply as a function of the current real wage and consumption the influence of expected future real wages and interest rates is captured by the consumption variable the empirical results do not support the intertemporal substitution model

what determines china s crude oil importing trade patterns empirical evidences from 55 countries between 1992 and 2015 abstract this study develops a conceptual framework that synthesizes the supply demand price and openness of crude oil trade along with a list of traditional economic political and geographical factors to investigate the determinants of crude oil imports in emerging markets we test the framework using china s crude oil imports from 55 countries for the period from 1992 to 2015 using both static and dynamic panel data models we find that china s crude oil import is associated with exporting country s supply demand and price as well as its bilateral trade relationships these factors were found to affect china s import of crude oil from the middle east however only bilateral trade relationships affect its imports of crude oil from the asia pacific furthermore we do not find substantial evidence in this research to indicate that china s direct investment increases crude oil imports from those countries this article is part of a virtual special issue entitled comparing sustainable energy policies in northeast asia toward the harmonized public private partnership

efficient labor contracts with employment risk this article analyzes efficient employment agreements where the demand for consumption insurance can be satisfied by noncontractual means we assume that workers can save and that consumption is determined by a strong form of the permanent income hypothesis under conditions of asymmetric information about exogenous shocks to labor demand we derive a unique compensation schedule that efficiently guides decisions by both workers and employers efficient employment outcomes are generated without a need for third party enforcement or monitoring and workers choose a consumption policy that leaves them indifferent among realizations of labor demand within this solution it is both costless and efficient for workers to delegate employment decisions to the firm within the context of the model we analyze implications for the equilibrium distribution of wages and for empirical studies of labor supply

labour force participation timing and persistence this paper examines the relative importance of timing and persistence elements in explaining cyclical fluctuations in labour supply data from the natural experiment provided by world war ii and cross sectional data on american local labour markets as well as aggregate time series data are used in the empirical work we find little evidence that timing effects play an important role in labour market dynamics the evidence suggests that views emphasizing persistence are more accurate and that previous employment tends to raise the probability of subsequent employment much of the development of applied economic theory within the past 25 years has emphasized the importance of viewing economic decisions in a life cycle context consumption decisions are today frequently viewed as being determined by wealth or permanent income the human capital revolution has brought life cycle considerations to the forefront of modern labour economics while the life cycle dynamics of labour force participation decisions have important implications for macroeconomic theory and policy they have received relatively little empirical attention with the notable exceptions of lucas and rapping 1969 and hall 1980 none of the large body of work on cyclical fluctuations in employment has explicitly relied on a dynamic model of labour supply this paper uses several types of data to examine two elements of participation dynamics the first is the aspect of timing which is implicit in the work of lucas and rapping and in mincer s 1966 early discussion of hidden unemployment the timing argument which is presented most explicitly in ghez and becker 1975 holds that leisure is easily substitutable across periods hence relatively small transitory movements in the perceived real wage or real rate of return can have large effects on the path of labour supply as individuals time their participation to coincide with periods of high transitory wages on the other hand permanent changes because they do not affect the timing decision are expected to have a much smaller effect on participation it is this view of labour supply which underlies new classical macroeconomic models the dependence is made explicit in lucas 1975 who claims that what we do know indicates that leisure in one period is an excellent substitute for leisure in other nearby periods the ability of classical macroeconomic models to explain fluctuations in employment depends on the presence of strong intertemporal substitution effects unless

unstable bandwagon and habit effects on labor supply abstract this paper develops a dynamic labor supply model based on unstable bandwagon and habit effects it possesses multiple long run equilibria and exhibits hysteresis and transitions between home and market time dependent on the wage rate these properties are robust the model provides an explanation of the long run increase in labor supply by married women in the netherlands the usa and other oecd countries

on testing the intertemporal substitution theory of labor supply many empirical tests of the intertemporal substitution theory of labor market fluctuations have assumed that shocks to the labor demand curve are the sole source of variance in hours and wages we show that conclusions based on these tests are very sensitive to small deviations from this extreme case using data generated by a standard real business cycle model we show that standard methods incorrectly reject the intertemporal substitution theory even when demand curve shocks account for over 90 of the variance in wages and hours

a new theory of aggregate supply macroeconomic theory contains two competing explanations of business cycle fluctuations according to the intertemporal substitution mechanism its observed variations in employment represent the optimal response of labor supply to misperceived variations in the expected real rate of interest a competing theory is offered by the literature on overlapping contracts that attributes employment variations to contracted nominal wage rigidities such rigidities prevent prices from adjusting in a way that would allow quantities to mimic the theoretical predictions of the walrasian marketclearing model both of these theories incorporate the property that employment converges in the long run to a natural rate of employment this paper develops an alternative theory it presents a model of an economy in which agents are rational utility maximizers with perfect foresight of future prices nevertheless the competitive equilibrium is pareto inefficient this situation arises because the economy does not contain a complete set of markets perfect capital markets do not exist because of asymmetric information ai a complete set of futures markets does not exist because agents have finite lives and trades cannot be negotiated with the unborn these two sources of market failure are modeled by embedding a theory of ai contracts into an overlapping generations model olg in which a critical role is played by the additional assumption that in some states of nature bankruptcy may be a binding constraint the nonexistence of futures markets generates a model with the property that government debt is real wealth which implies that fiscal policy can have a permanent effect on the real rate of interest the bankruptcy constraint translates changes in the rate of interest into changes in the frequency of contract default simply stated a high interest rate increases the probability that a firm will go bankrupt or that it will layoff workers in sharp contrast to either the new classical or the sticky price contract explanations of business cycle fluctuations this theory is not a natural rate theory even in the long run it predicts that the steady state employment level is an endogenous variable which varies systematically with fiscal policy

employment and hours over the business cycle abstract approximately one quarter of the adjustment in total hours of employment over the business cycle represents adjustments in hours while the remainder is explained by changes in employment real business cycle models characterize agents as either continuously adjusting their hours or making only labor force participation decisions about jobs with indivisible hours in this paper we extend the representative agent framework to allow for decisions on both participation and hours we calibrate and simulate a dynamic version of the model and show that it is better able to mimic some features of the aggregate data

determinants of china s energy imports an empirical analysis sustained economic growth in china has triggered a surge of energy imports especially oil imports this paper investigates the determinants of china s energy import demand by using cointegraiton and vecm techniques the findings suggest that in the long run growth of industrial production and expansion of transport sectors affect china s oil imports while domestic energy output has a substitution effect thus as the chinese economy industrializes and the automotive sector expands china s oil imports are likely to increase though china s domestic oil production has a substitution effect on imports its growth is limited due to scarce domestic reserve and high exploration costs it is anticipated that china will be more dependent on overseas oil supply regardless of the world oil price

labour market conditions and labour force participation the case of the netherlands we develop a model to explain the relationship between unemployment and labour force participation by males and females in the netherlands following recent advances in the literature a distinction is made between temporary and permanent unemployment our findings indicate that male labour force participation is significantly influenced by the temporary unemployment variable while permanent unemployment does not seem to play a significant part for females we find the opposite

import demand of crude oil and economic growth evidence from india abstract this study establishes a long run equilibrium relationship among quantity of crude oil import income and price of the imported crude in india for the time span 1970 1971 to 2005 2006 using autoregressive distributed lag ardl bounds testing approach of cointegration empirical results show that the long term income elasticity of imported crude in india is 1 97 and there exists a unidirectional long run causality running from economic growth to crude oil import so reduction of crude oil import will not affect the future economic growth in india in the long run india should take various energy efficiency and demand side management measures in transport sector along with other measures like expanding and strengthening indigenous resource base substituting imported fuels by domestic fuels and de controlling the price of petroleum products to reduce its import dependence

economic transition and growth some extensions of neoclassical growth models are discussed that allow for cross section heterogeneity among economies and evolution in rates of technological progress over time the models oer a spectrum of transitional behavior among economies that includes con vergence to a common steady state path as well as various forms of transitional divergence and convergence mechanisms for modeling such transitions and measuring them econo metrically are developed in the paper a new regression test of convergence is proposed its asymptotic properties are derived and some simulations of its nite sample properties are reported transition curves for individual economies and subgroups of economies are estimated in a series of empirical applications of the methods to regional us data oecd data and penn world table data

part time participation over the life cycle among married women who work in the market reported here are the estimates from two logit models of married women s labour force employment a pooled unconditional logit that does not control for fixed effects and a conditional logit model incorporating fixed effects both sets of results indicate the presence of occupational segregation between part time and full time employment since the amount of part time experience a woman has obtained increases the probability of part time employment these results are in agreement with those reported in previous studies that the presence of preschool children differentially encourages part time employment

what drives the formation of global oil trade patterns abstract in this paper the spatial characteristics of current global oil trade patterns are investigated by proposing a new indicator moran f meanwhile the factors that influence the formation of oil trade patterns are identified by constructing four different kinds of spatial econometric models the findings indicate that most oil exporters have an obvious export focus in north america and a relatively balanced export in europe and the asia pacific region besides supply and demand factors technological progress and energy efficiency have also significantly influenced the oil trade moreover there is a spillover effect of trade flow among different regions but its impact is weak in addition oil importers in the same region have the potential to cooperate due to their similar import sources finally promotion of oil importers r d investments can effectively reduce the demand for global oil trade

multilevel lmdi decomposition of changes in aggregate energy consumption a cross country analysis in the eu 27 abstract this paper aims at analysing the factors behind the change in aggregate energy consumption in the eu 27 also identifying differences between member states the logarithmic mean divisia index method lmdi is applied to multiplicatively decompose at the country level the variation in aggregate energy consumption in the eu 27 member states for the 2001 2008 period we also analyse the sensitivity of the results when several aggregation levels are considered with energy intensity used as the criterion to aggregate countries this allows us to check robustness of results also enabling an improved understanding of both inter and intra unit effects results indicate that improvements in energy efficiency in the eu 27 were not enough to overcome the pressure of european economic activity on aggregate energy consumption mediterranean countries and especially former communist states increased their energy consumptions most of them favoured by structural change the analysis also reveals that the impact of intra group movements on aggregate energy consumption is partially offset when moving from higher to lower aggregation levels

a classical model of involuntary unemployment efficiency wages and macroeconomic policy abstract a two period monetary overlapping generations model with efficiency wages is constructed in which the workers effort is unobservable and wage contracts verify an incentive compatibility constraint to prevent shirking its dynamics is similar to the one of a market clearing neoclassical model driven by intertemporal substitution effects in which the labour supply curve would be replaced by a nonshirking condition but normative properties of macroeconomic policies differ in particular employment subsidies are welfare improving and the golden rule on real interest rates may not hold conditions for a transitory increase in public consumption to be welfare improving are also obtained journal of economic literatureclassification numbers e24 e62 j41

labour supply incentives and the taxation of family income taxing family income richard blundell and ian walker will lower marginal rates of income tax increase incentives to work the traditional theoretical argument ignores the fact that many individuals are members of households with more than one potential participant in paid employment the theory of optimal income tax is utilized to argue that the tax system should discriminate between individuals in the same household if their labour supply responses are different empirically the response of labour supply to changes in after tax wages is largest for secondary workers particularly married women hence the largest beneficial incentive effect is obtained if such individuals face lower tax rates since these individuals typically have below average pre tax earnings this suggests a simple way to implement our proposal establish a progressive income tax with individual earnings as the basis of assessment this might have additional advantages of fairness but its primary purpose would be to ensure that low earning but highly responsive individuals face low marginal tax rates while high earning but relatively unresponsive individuals face higher marginal tax rates contrary to popular wisdom a flat rate tax system would be less favourable for work incentives we illustrate this theoretical argument using an empirical model of labour supply embedded in a micro computer programme capable of simulating alternative tax systems

an examination of regional interaction and super regions in britain an error correction model approach gray d 2005 an examination of regional interaction and super regions in britain an error correction model approach regional studies 39 619 632 this paper examines spill over effects among regions estimating error correction models of british rates of unemployment and conducting granger causality tests it is found that on a short run basis the west midlands is a leading territory within a closely knit group of surrounding regions the paper draws a distinction between a core and a leading region suggesting the core region the south east is a follower responding to and magnifying economic fluctuations the policy implications are that current regional delineations may not be consistent with the demands of economic coherence at the national level and so is not optimal for the delivery of decentralized spatial economic policy indeed as economic engineering in the high unemployment periphery has consequences for more prosperous areas it may be better not to allow local administrators too m

exchange rate of the us dollar and the j curve the case of oil exporting countries abstract this study examines the effects of changes in the exchange rate of the us dollar on the trade balances of three oil exporting countries namely iran venezuela and saudi arabia an exchange rate pass through model is applied to allow changes in the exchange rate of the dollar to affect prices of traded goods then the impact of changes in prices on the quantities of imports and exports of these economies is estimated the results suggest a partial exchange rate pass through to these countries import and export prices in terms of the us dollar while the three countries raise the price of their primary export namely crude oil in response to a depreciation of the dollar saudi arabia s long run pricing strategy in securing a larger market share stands in contrast to that of the two other opec members the sum of the estimated long run price elasticities of demand for imports and exports is found to exceed unity for iran and venezuela but less than unity for saudi arabia

labor force participation and monetary policy in the wake of the great recession in this paper we provide compelling evidence that cyclical factors account for the bulk of the post 2007 decline in the u s labor force participation rate we then proceed to formulate a stylized new keynesian model in which labor force participation is essentially acyclical during normal times that is in response to small or transitory shocks but drops markedly in the wake of a large and persistent aggregate demand shock finally we show that these considerations can have potentially crucial implications for the design of monetary policy especially under circumstances in which adjustments to the short term interest rate are constrained by the zero lower bound

dynamic labour force participation of married women and endogenous work experience this paper presents and estimates a dynamic model of married women s labour force participation and fertility in which the effect of work experience on wages is explicitly taken into account because current participation alters future potential earnings the investment return to work will be an important factor in the current work decision in any forward looking behavioural model the model is estimated using the national longitudinal surveys mature women s cohort we use the estimates of our model to predict changes in the lifecycle patterns of employment due to changes in schooling fertility husband s income and the magnitude of the experience effect on wages we find that although work experience increases the disutility of further work the effect is overwhelmed by the positive effect of experience on wages leading to persistence in the employment patterns of these women in addition we find that an increase in young children and in husband s income substantially reduces participation while increased schooling has a powerful positive impact on participation this paper presents an estimable structural dynamic model of married women s labour force participation and fertility in which wages are stochastic and work experience or cumulative participation is endogeneous the model is structural in the sense that the parameters which are estimated are contained in the fundamental relationships governing behaviour namely the utility function and the constraints the model is contained in the class of models which describe the life cycle capital accumulation process with endogeneous labour supply such as weiss 1972 and heckman 1976 it is closest in spirit to that of weiss and gronau 1981 1 the basic feature of their model and ours is that labour market participation affects future wages which then affects future participation the investment return to current work will necessarily be taken into account in any forward looking optimizing model as weiss and gronau note estimates of labour supply models have ignored the inherent behavioural dynamics associated with a positive wageexperience profile there is no adequate empirical treatment of the human capital investment dimension of the labour force participation decision in the literature heckman and willis 1977 have studied a sequential discrete choice model of the labour force participation of married women in a reduced form framework their work

anticipated and unanticipated wage changes wage risk and intertemporal labor supply in this article i estimate how labor supply responds to anticipated wage growth unanticipated wage growth and wage risk using the 1989 93 panel section of the bank of italy survey of households income and wealth shiw which collects individual expectations of future wages the use of subjective expectations has several advantages first they provide information on the evolution and riskiness of future wages that the econometrician may never hope to observe moreover this avoids the need for specifying instruments for the growth rate of wages finally forecast errors can be directly controlled for thus avoiding inconsistency in short panels

do language barriers affect trade abstract language barriers may be more important to international trade than previously thought the language barrier index a newly constructed variable that uses detailed linguistic data is used to show that language barriers are significantly negatively correlated with bilateral trade

labor supply under real wage uncertainty a new look at the intertemporal substitution hypothesis the idea that timing may play a crucial role in labor supply decisions has existed in several forms since mincer s 12 seminal work on the labor force participation decisions of married women mincer suggested at that time that married women s labor supply decisions may be quite responsive to transitory variations in earnings lucas and rapping 11 generalized the notion of timing by suggesting that for any individual consumption of leisure and other goods in the current period is readily substitutable with consumption in other periods in this framework the laborer is viewed as a capitalist and the decision to transfer one s labor supply from one market period to another is recognized as an investment decision 11 729 this concept of intertemporal substitution has been controversial as it has proven quite difficult to substantiate empirically while the estimates obtained by lucas and rapping were favorable the recent and much more elaborate tests provided by altonji 1 and clark and summers 5 have failed to support the intertemporal substitution hypothesis these studies have used models in which individuals base their current labor supply decisions on the magnitudes of current and expected variables if current decisions can be shown to be responsive to expected levels of relevant variables then this indicates that individuals do in fact choose when to and when not to supply labor over the course of the business cycle and the notion of intertemporal substitution is supported the approach then has been to estimate the net present value of the expected levels of wages and prices at each point in time and to base tests of the intertemporal substitution hypothesis on the performance of these expectations variables implicitly these models assume that people live in an uncertain world and that they base their current decisions on what they judge to be the likely future values of important economic variables a key element which has been missing from previous studies is consideration of how the level of uncertainty associated with peoples expectations affects decisions made at each point in time this paper attempts to fill that gap by focusing upon the effects of real wage uncertainty on labor supply decisions

two birds with one stone female labor supply fertility and market childcare abstract the correlation between the female labor force participation rate fpr and the total fertility rate tfr has switched from negative to positive in some developed countries in this paper we show how increasing the substitutability between maternal time and market childcare can raise both fpr and tfr and provide an explanation for the change in the tfr fpr correlation simulations of a life cycle model of married women s work and fertility decisions indicate that the fpr increases whereas the tfr is u shaped with regard to substitutability the dynamic relationship depends on the relative strength of behavioral and composition effects greater substitutability allows working women to have more children but it also attracts less productive women to enter the labor force who trade childbirths for labor supply the findings imply that raising substitutability to a sufficiently high level can achieve the two seemingly conflicting goals increasing female labor force participation and fertility rates

the baby boom and world war ii a macroeconomic analysis we argue that one major cause of the u s postwar baby boom was the rise in female labor supply during world war ii we develop a quantitative dynamic general equilibrium model with endogenous fertility and female labor force participation decisions we use the model to assess the impact of the war on female labor supply and fertility in the decades following the war for the war generation of women the high demand for female labor brought about by mobilization leads to an increase in labor supply that persists after the war as a result younger women who reach adulthood in the 1950s face increased labor market competition which impels them to exit the labor market and start having children earlier the effect is amplified by the rise in taxes necessary to pay down wartime government debt in our calibrated model the war generates a substantial baby boom followed by a baby bust

intertemporal substitution and constraints on labor supply evidence from panel data intertemporal substitution and constraints on labor supply evidence from panel data i introduction through much of the 1970s and 1980s macroeconomic stabilization analysis has been dominated by equilibrium models in which fluctuations in employment result from intertemporal substitution workers voluntarily vary their labor supply over time in response to movements in wages and interest rates a number of recent empirical tests of intertemporal substitution models for example altonji 1982 mankiw et al 1985 ham 1986 strongly reject the intertemporal substitution approach these results have led some economists to reject equilibrium macro models in favor of keynesian models in which workers face quantity constraints on labor supply in keynesian models employment fluctuations result from changes in the severity of constraints that is changes in involuntary unemployment rather than intertemporal substitution on the other hand many economists remain unconvinced by recent rejections of intertemporal substitution models because the results are consistent with many possible explanations for tractability empirical studies always impose restrictive assumptions such as separability of utility over time and between goods or such as the existence of a representative consumer data also suffer from numerous problems such as aggregation bias measurement error and the use of average rather than marginal wage rates consequently even the authors of the studies seem hesitant to draw firm conclusions they often simply conclude that workers behavior is explained either by quantity constraints or by a more complicated intertemporal substitution model than the one they have tested 1 this paper attempts to determine which of these explanations is correct are changes in employment a sophisticated form of intertemporal substitution or are they involuntary the crucial data come from questions in the panel study of income dynamics about whether workers experience unemployment or are unable to work as many hours as they want following ham 1982 1986 this information is used to classify workers as quantity constrained in their labor supply or unconstrained i then test a simple intertemporal substitution model for each group of workers if the tests suffer from overly restrictive utility functions or data problems then the model should be rejected for both samples on the other hand if some workers truly face quantity constraints then the model should perform better for the sample of unconstrained workers 2 the tests yield two main results first the model indeed performs worse for the constrained workers for this group the data reject the model s overidentifying restrictions and the parameter estimates contradict the model in contrast the results for the unconstrained workers are weakly consistent with the model as keynesian theories suggest quantity constraints alter workers behavior second the estimates of the intertemporal labor supply elasticity for prime age men are close to zero even for unconstrained workers even if workers are free to vary their hours they apparently choose to respond little to movements in wages the paper addresses two other issues first do constraints on borrowing influence labor supply in the intertemporal substitution model workers borrow and lend to smooth consumption while varying hours of work as this suggests the model performs best for workers who not only face no labor supply constraints but who also own substantial assets and thus are unlikely to face liquidity constraints finally the paper proposes a new approach to identifying intertemporal labor supply equations previous micro studies do not adequately address the problem that wages are correlated with unobservable characteristics that affect tastes for work i propose two identifying restrictions 1 changes in tastes are uncorrelated with levels of time in variant variables and 2 changes in tastes have no aggregate component

the employment real wage relationship an international study the neoclassical and keynesian theories of employment both predict an inverse relationship between employment and real wages in the short run the observed correlation between employment and real wages however has usually failed to conform to this prediction dunlop 1938 and tarshis 1939 reported a positive correlation between real and money wages which given procyclical movement of money wages was interpreted as evidence against the theoretical prediction the statistical significance of these results was however challenged by ruggles 1940 and tobin 1948 more recent studies by kuh 1966 and bodkin 1969 failed to detect a significant relationship between real wages and employment these findings stimulated a series of contributions by solow and stiglitz 1968 barro and grossman 1971 1976 and others developing alternative models not apparently refuted by the evidence barro and grossman recast macro theory under the assumption that markets did not clear modigliani 1977 argued that the observed relationship between employment and real wages could be accounted for in an oligopolistic model of firm behavior thus both the competitive and equilibrium assumptions of the classical model were diagnosed as the sources of its apparent empirical refutation

exploring the driving factors of global lng trade flows using gravity modelling abstract taking into account the attributes of the liquefied natural gas lng trade and the space time characteristics of trade flows this paper identifies the multiple dimensional factors that influenced the global lng trade between 2004 and 2015 following an analysis of the data via the application of gravity models the empirical results of this study indicate that these influencing factors possess both general and regional characteristics in contrast to general trade the lng trade is mainly affected by the economic magnitude of the demand side regionally pipeline natural gas has a significant substitute effect on the lng trade within the global model though not within the asian model additionally the lng trade in asia is more sensitive to the influence of import prices and research and development investment than in the global model our subsample analyses show that the results are robustness across different periods finally this paper discusses pertinent policy implications for the lng trade especially as related to asia

a bayesian perspective on inference from macroeconomic data bayesian methods are logical admissible linguistically natural helpeful conceptually simple and honest but they are also preposterous and very labor intensive generalized bayesian methods allow data to be confusing and inconclusive a bayesian viewpoint allows one to get a handle on the conundrums of exploratory data analysis which are prevalent when the theory is vague and experiments are expensive these ideas are illustrated with a bayesian analysis of the determinants of the u s unemployment rate using four different priors as inputs

time varying hall consumption function some empirical evidence abstract according to the hall consumption function the level of consumption itself follows a random walk with drift which however recent econometric work fails to support compellingly while there are many possible explanations for this failure we pay attention to the neglected possibility that the labour market may not clear and look at the question of whether labour supply rationing matters for consumption behaviour by using u s quarterly data over the period 1948 ii 1980 iv estimation results both from linear and threshold models are compatible with the hypothesized effects of labour supply rationing on consumption autoregressions

some empirical evidence on the discouraged worker effect abstract this note produces empirical evidence on the existence of a significant discouraged worker effect in us data namely on the tendency for groups of secondary workers to move in and out of the labor force with the business cycle looking for jobs when these are available while giving up job search during recessions by focusing on the behavior of the not in the labor force series as well as of two of its segments going to school and keeping house at the business cycle frequencies both in the aggregate and for a number of age sex groups the series display a clear counter cyclical pattern thus lending support to the discouraged worker notion

diversification of oil import sources and energy security a key strategy or an elusive objective this paper explores the relationship between the diversification of sources of imported oil and energy security of oil importing countries it examines the importance of diversification policy for oil importers explains why oil importers implement oil diversification policy and contextualizes the oil import diversification strategy in the overall energy security policy of oil importers the paper analyzes the factors and the contexts that affect the level of importance assigned to oil import diversification policy in oil importing countries and the limitations that may affect the successful implication of oil import diversification policy the examples are drawn from the world s top three oil importers the united states japan and china the policymakers in these and other oil importing countries place much importance on energy security the diversification of oil import sources is used as one of the strategies to enhance energy security in oil importing countries this paper is important for policymakers in oil importing countries as it provides them with a qualitative conceptual framework with which to evaluate the need to diversify their countries sources of imported oil and with which to identify the likely limitations to the successful implementation of oil import diversification policy

on the robustness of alternative unemployment measures abstract the unemployment rate is one of the most important economic indices this article extends the work of feng and hu 2013 and examines the effects of potential misclassifications in labor force statuses on the different bureau of labor statistics bls unemployment measures compared to the official us unemployment rate u 3 the broader measure u 6 is more robust to such classification errors in the survey data that are used to calculate unemployment rates if one prefers the definitions of u 3 then we offer an approach to use reported unemployment measures to proxy for the unobserved true u 3

unemployment and liquidity constraints summary we present a dynamic framework for the interaction between borrowing liquidity constraints and deviations of actual hours from desired hours both measured by discrete valued indicators and estimate it as a system of dynamic binary and ordered probit models with panel data from the panel study of income dynamics we analyze a household s propensity to be liquidity constrained by means of a dynamic binary probit model we analyze qualitative aspects of the conditions of employment namely whether the household head is involuntarily overemployed voluntarily employed or involuntarily underemployed or unemployed by means of a dynamic ordered probit model we focus on the possible interaction between the two types of constraints we estimate these models jointly using maximum simulated likelihood where we allow for individual random effects along with an autoregressive process for the general error term in each equation a novel feature of our method is that it allows for the random effects to be correlated with regressors in a time invariant fashion our results provide strong support for the basic theory of constrained behavior and the interaction between liquidity constraints and exogenous constraints on labor supply copyright 2007 john wiley sons ltd

estimates of the variance of u s inflation based upon the arch model it is generally agreed that the unpredictability of future inflation is a major component of the welfare loss associated with inflation perfectly predicted inflation might induce some costs through institutional rigidities governmental interference and transaction costs but in the long run these should be rather minimal as these institutions adopt various forms of indexing when inflation is unpredictable risk averse economic agents will incur a loss even if prices and quantities are perfectly flexible in all markets inflation is a measure of the relative price of goods today and goods tomorrow thus uncertainty in tomorrow s price impairs the efficiency of today s allocation decisions friedman in his nobel lecture 8 argues convincingly that higher variability of inflation would lead to decreased output ceteris paribus he then conjectures that higher rates of inflation are generally associated with higher variability of inflation and presumably greater uncertainty about future rates if this is true then higher rates of inflation would also be associated with low levels of output which implies a positively sloped phillips curve this paper uses a new statistical technique arch to estimate the conditional mean and variance of inflation from u s time series data the main finding is that the variance of inflation in the seventies was only slightly greater than in the sixties

a structural explanation of recent changes in life cycle labor supply and fertility behavior of married women in the united states abstract this study documents and explains important changes in the life cycle labor supply and fertility behavior of married women in the united states from the 1950s to more recent cohorts the younger cohorts relative to the 1950s supply more labor at earlier stages of the life cycle delay motherhood to later stages without reducing the fertility rate and upon childbearing show a greater tendency to stay out of the labor force in a life cycle model for married couples in which a household makes decisions on fertility as well as labor supply consumption and savings all the behavioral changes are jointly and quantitatively explained by a combination of changes in various labor supply fertility determinants with the increased returns penalties to work non work experience being the dominant contributor the results survive a series of robustness tests including endogenizing education choice and assortative marriage

search wage bargains and cycles in this paper i describe an equilibrium model of job matchings with perfect foresight that has the following property the number of people looking for work changes temporarily when there is a temporary shock to the value of labour s marginal product it does not change when the shock is permanent by contrast real wages change temporarily by a small amount when the shock is temporary but change permanently and by a bigger amount when the shock is permanent thus the model offers an explanation for the observation that over the cycle small wage changes are associated with changes in unemployment whereas secularly wage growth does not seem to affect the rate of unemployment the two most common explanations for this observation in the literature the phelps lucas misperceptions model and the lucas rapping intertemporal substitution model are well grounded in equilibrium theory but they have not stood up well to empirical testing the misperceptions model requires more ignorance of aggregate changes than can be reasonably assumed whereas the intertemporal substitution model requires bigger wage elasticities of labour supply than those estimated in the model of this paper neither misperceptions nor changes in the supply of labour play a role in generating the unemployment cycle all agents observe the shocks when they occur and they anticipate correctly the economy s adjustment path but like the new classical explanations of the cycle the model is an equilibrium one in the sense that all private gains from trade are fully exploited at all phases of the cycle although the social gains from trade may not be fully exploited because of search externalities the cycle i derive here is not due to externalities unlike other related perfect foresight models such as diamond s 1982a the structure of the model is such that the externalities do not give rise to multiple equilibria the key element of the model which is responsible for the transmission of output shocks to unemployment is the equation for wages in markets where the allocation of jobs takes place through search both firms and workers have some monopoly power a point emphasised by mortensen 1970 though he attributed only temporary monopoly power and only to firms i use the nash bargaining solution to solve for the equilibrium wage rate and show that the firm s and worker s alternative returns threat points or

testing whether unemployment represents intertemporal labour supply behaviour in the lucas rapping 1969 model of the labour market fluctuations in unemployment represent individuals optimally adjusting their labour supply behaviour in response to fluctuations in wage rates over the business cycle in this paper i propose and implement a misspecification test of the lucas rapping treatment of unemployment as labour supply behaviour using panel data this test extends previous such work with micro data by simultaneously allowing for intertemporal substitution uncertainty and endogenous unemployment using the standard specification of intertemporal labour supply behaviour i find strong evidence against this interpretation of unemployment there are two possible interpretations of the test results the first is that it is necessary to turn to alternative models of the labour market in which unemployed workers are off a supply function the second is that the test results indicate the necessity of moving to more complex models of intertemporal substitution however given current econometric techniques and data sets these alternative models of intertemporal substitution will be extremely difficult to test

unemployment disequilibrium and the short run phillips curve an econometric approach the paper specifies a disequilibrium model for the aggregate labour market consisting of demand and supply functions for labour an adjustment equation for wages as well as for prices a transactions equation and finally an equation that relates measured unemployment to vacancies and to excess demand the model has a more sophisticated treatment of dynamics than earlier disequilibrium models the parameter estimates and the goodness of fit are satisfactory and the model s implications for the behaviour of several important variables are sensible in particular excess demand estimates computed in various ways are reasonable

wage and employment uncertainty and the labor force participation decisions of married women this paper argues that an important factor in a married woman s decision to enter the labor force is the degree of uncertainty associated with expectations offuture wages and husband s income and that high levels of uncertainty during the 1970s may have contributed substantially to the growth in participation in that decade we apply a model of autoregressive conditional heteroskedasticity to aggregate time series data to measure the level of uncertainty in each period our estimates support our hypothesis that the level of uncertainty is an important determinant of labor force participation for married women

the language effect in international trade a meta analysis abstract gravity models of international trade have been frequently applied to estimate the impact of common official or spoken language on bilateral trade this study provides a meta analysis based on 701 language effects collected from 81 academic articles on average a common official or spoken language increases trade flows directly by 44

time series representations of economic variables and alternative models of the labour market accepting the hypothesis that the time series facts of the aggregate labour market may be summarized by the linear autoregressive and moving average representations of wages prices unemployment and interest rates implies that a useful theory ought to lead to predictions about these representations following this approach this paper first catalogues many of the time series facts about the aggregate labour market and then compares them against alternative models of the labour market based on the intertemporal substitution and staggered contract hypotheses