who are the unemployed evidence from the united kingdom using the uk labour force survey 2005 2012 we analyse heterogeneity among non employment subgroups in future employment hazards based on the results we propose alternative measures of unemployment that include out of the labour force subgroups with similar or higher hazards to the officially unemployed

the added worker effect the term added worker effect usually refers to a temporary increase in the labor supply of married women whose husbands have become unemployed this paper presents a new approach to the empirical study of the added worker effect which emphasizes the role of employment uncertainty and credit constraints in generating short run participation and employment patterns the estimates are based on employment transition probabilities rather than static measures of labor supply and are used in a dynamic simulation of changes in the employment and participation rates of wives following an exogenous increase in unemployment among their husbands the results show a small but significant added worker effect at least for white families and suggest that the apparent disagreement among previous studies may stem from different approaches to measuring responses to a transitory event such as an unemployment spell

inflation and welfare in a monetary economy it is in everyone s private interest to try to get someone else to hold non interest bearing cash and reserves but someone has to hold it all so these efforts must simply cancel out all of us spend several hours per year in this effort and employ thousands of talented and highly trained people to help us these person hours are simply thrown away wasted on a task that should not have to be performed at all

tests for parameter instability in regressions with i 1 processes this article derives the large sample distributions of lagrange multiplier lm tests for parameter instability against several alternatives of interest in the context of cointegrated regression models the fully modified estimator of phillips and hansen is extended to cover general models with stochastic and deterministic trends the test statistics considered include the supf test of quandt as well as the lm tests of nyblom and of nabeya and tanaka it is found that the asymptotic distributions depend on the nature of the regressor processes that is if the regressors are stochastic or deterministic trends the distributions are noticeably different from the distributions when the data are weakly dependent it is also found that the lack of cointegration is a special case of the alternative hypothesis considered an unstable intercept so the tests proposed here may also be viewed as a test of the null of cointegration against the alternative of no cointegration the tests are applied to three data se

the measurement of labor force dynamics with longitudinal data the labour market activity survey filter this article explores the measurement of labor force dynamics using longitudinal data focusing in particular on the canadian labour market activity survey lmas which represents a potential advance in longitudinal data collection because it measures aspects of dynamics not available in existing panel data such as the panel study of income dynamics and the national longitudinal survey we examine the implications of the lmas questionnaire structure the lmas filter for the study of labor market dynamics and undertake simulations to provide a quantitative assessment of the importance of this filter for labor force spells and transitions between labor force states

confronting the environmental kuznets curve t he environmental kuznets curve posits an inverted u relationship between pollution and economic development kuznets s name was apparently attached to the curve by grossman and krueger 1993 who noted its resemblance to kuznets s inverted u relationship between income inequality and development in the first stage of industrialization pollution in the environmental kuznets curve world grows rapidly because people are more interested in jobs and income than clean air and water communities are too poor to pay for abatement and environmental regulation is correspondingly weak the balance shifts as income rises leading industrial sectors become cleaner people value the environment more highly and regulatory institutions become more effective along the curve pollution levels off in the middle income range and then falls toward pre industrial levels in wealthy societies the environmental kuznets curve model has elicited conflicting reactions from researchers and policymakers applied econometricians have generally accepted the basic tenets of the model and focused on measuring its parameters their regressions typically fitted to cross sectional observations across countries or regions suggest that air and water pollution increase with development until per capita income reaches a range of 5000 to 8000 when income rises beyond that level pollution starts to decline as shown in the conventional ekc line in figure 1 in developing countries some policymakers have interpreted such results as conveying a message about priorities grow first then clean up numerous critics have challenged the conventional environmental kuznets curve both as a representation of what actually happens in the development process and as a policy prescription some pessimistic critics argue that crosssectional evidence for the environmental kuznets curve is nothing more than a

unemployment and nonemployment heterogeneities in labor market states abstract the determination of how to distinguish between unemployment and nonparticipation is important and controversial the conventional approach employs a priori reasoning together with self reported current behavior this paper employs an evidence based classification of labor force status using information about the consequences of the behavior of the nonemployed we find that marginal attachment defined as desiring work although not searching is a distinct labor market state lying between those who do not desire work and the unemployed furthermore important heterogeneities exist within these nonemployment states two subsets of nonparticipants both engaged in waiting display behavior similar to the unemployed

does the ilo definition capture all unemployment the labour market status of many non working persons is at the boundary between unemployment and inactivity like the unemployed they seek and are available for work unlike them their last search action was not recent enough to meet the ilo definition of unemployment in this paper we examine by non parametric tests how the transition probabilities of these out of the labour force job seekers differ from those of the unemployed as well as the other non participants first using data from the european community household panel we show that in most eu countries these job seekers constitute a distinct labour market state second we rely on information only available in the italian labour force survey to derive a measure of search intensity which we use to break down the out of the labour force job seekers on the basis of their transition probabilities the most active are indistinguishable from the unemployed

estimating a structural search model the transition from school to work this paper presents a finite horizon search model that is econometrically implemented using all of the restrictions impli ed by the theory following a sample of male high school graduates fr om the youth cohort of the national longitudinal surveys from graduat ion to employment search parameters are estimated reservation wages and offer probabilities are estimated to be quite low simulations a re performed of the impact of changing the parameters on the expected duration of unemployment copyright 1987 by the econometric society

impact of industrialisation on co2 emissions in nigeria abstract developing countries including nigeria aim to achieve industrialisation and sustainable development however there are few empirical studies that examined the impact of industrialisation led economic transformation on carbon emissions in developing countries this is the focus of this study the paper investigates the impact of industrial value added on co2 emissions in nigeria using the kaya identity framework and augmented dickey fuller adf johansen s cointegration technique and vector error correction model vecm the data spans from 1980 to 2011 the result of the adf test indicates that continual long term policies that exert permanent shocks on the variables are required to achieve economic development industrialisation and co2 reduction the result of the analysis shows that industrial value added has an inverse and significant relationship with co2 emissions which suggests that there is no evidence that industrialisation increases carbon emissions in nigeria gdp per capita and population has positive and significant impacts on co2 emission energy intensity and carbon intensity has positive but very weak significant impact at 10 level on co2 emission the paper recommends that policy makers in nigeria should pursue pragmatic industrialisation policies coupled with modest decarbonisation and energy efficiency measures in order to ensure long term industrial economic and sustainable development

unemployment behaviour evidence from the cps work experience survey this chapter is empirical and descriptive rather than theoretical it examines the cps unemployment experience data which gives the number of weeks of unemployment and the number of spells of unemployment experienced by a sample of people in a year this chapter focuses on both the entry rate or frequency probability of entering and the exit rate or duration probability of exiting of unemployment spells for it is on both the entry and exit rates that the level and distribution of unemployment depends the conclusion is that entry rates and differences in entry rates across people are of primary importance in explaining unemployment experience

are there limits to growth a simple theoretical model of pollution is developed that generates an inverted u shape relationship between per capita income and environmental quality this model is then used to study long run growth the same inverted u shape is shown to appear in time series and the prospects for sustained growth are shown to hinge on whether increasingly strict environmental regulation is compatible with a constant rate of return on capital implementation is also studied tax and voucher schemes are shown to have an advantage over direct regulation because they provide the correct incentives for capital accumulation copyright 1998 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association

disability retirement and unemployment substitute pathways for labour force exit an empirical test for the case of germany this paper studies the determinants of disability retirement and unemployment of older workers two labour market phenomena which the german public discussion combines under the label of early retirement the implicit assumption that these two mechanisms are exchangeable pathways into permanent retirement is tested using panel data the transition rates from employment into disability retirement and into unemploymentare estimated and compared statistical tests reject the hypothesis that disability retirement and unemployment are substitutes

on the welfare cost of inflation and the recent behavior of money demand post 1980 u s data trace out a stable long run money demand relationship of cagan s semi log form between the m1 income ratio and the nominal interest rate with an interest semi elasticity of 1 79 integrating under this money demand curve yields estimates of the welfare cost of modest departures from friedman s zero nominal interest rate rule for the optimum quantity of money that are quite small the results suggest that the federal reserve s current policy which generates low but still positive rates of inflation provides an adequate approximation in welfare terms to the alternative of moving all the way to the friedman rule jel e31 e41 e52

extensive margins and the demand for money at low interest rates we argue that the relevant monetary decision for the majority of u s households is not the fraction of assets to be held in interest bearing form but whether to hold any such assets at all we call this the decision to adopt the financial technology we show that the key variable governing the adoption decision is the product of the interest rate times the total amount of assets this implies that the interest elasticity of household money demand at low interest rates can be estimated from the variation in asset holdings in a cross section of households rather than historical interest rate variations we do so with the 1989 survey of consumer finances we find that a the elasticity of money demand is very small when the interest rate is small b the probability that a household holds any amount of interest bearing assets is positively related to the level of financial assets and c the cost of adopting financial technologies is negatively related to participation in a pension program at intere

measuring the equilibrium effects of unemployment benefits dispersion we analyze the impact of unemployment benefits and minimum wagesusing an equilibrium search model which allows for dispersion ofbenefits and productivity levels job to job transitions andstructural and frictional unemployment the estimation method usesreadily available aggregate data on marginal distributions ofunemployment durations as well as wages and benefit levels different causes of structural and frictional unemployment areinvestigated we investigate the efficiency of the imposition of asingle benefit level for all household types and the introductionof an earned income tax credit

shoe leather costs reconsidered lucas has recently suggested that the shoe leather costs of inflation may amount to as much as 1 of gnp in the united states when moving to the friedman optimum we assess his thesis using empirical evidence for the united kingdom over the period 1870 1994 we find support for lucas proposition that interest rates should be specified in logs as a description of money demand dynamics but not as a steady state characterisation although lucas estimates can be corroborated a semilog interest rate specification implies smaller though still tangible welfare gain estimates for example 0 22 of gnp in perpetuity when moving from 6 to 2 nominal interest rates

defining unemployment in developing countries evidence from trinidad and tobago the international labour organisation ilo argues for relaxing the standard definition of unemployment in developing countries by eliminating the requirement that a person be actively searching for a job we examine whether such an extension of the standard definition is appropriate in the case of trinidad and tobago t t specifically we use the trinidad and tobago labour force survey to examine whether active job search is important in determining the labour market transitions of the non employed our results indicate that in trinidad and tobago males who under the standard criteria would be considered out of the labour force because they report willingness to work but are not currently searching for a job are appropriately classified as unemployed further evidence suggests that this may be because job search may not be as meaningful in rural as it is in urban areas c 2003 elsevier b v all rights reserved

sweep programs the fall of m1 and rebirth of the medium of exchange this paper investigates the effect of sweep programs on m1 using dynamic simulations of money demand over 1994 2000 the postsample period constitutes when sweep programs have been in effect all models generate predictions systematically above reported m1 using data on newly initiated programs test findings indicate that sweeps account for the overprediction within the conventional money demand model with a long term interest rate we construct a medium of exchange measure m1s equal to m1 plus estimated holdings of sweep balances m1s velocity compares favorably with that of broader aggregates evidence indicates cointegration within m1s money demand

new evidence on whether unemployment and out of the labor force are distinct states this paper focuses on the question of whether people who are out of the labor force olf should be included in unemployment measures if people who are olf can obtain jobs as often as the people who are unemployed then there is no real distinction between the two states of nonemployment surprisingly there has been very little effort surrounding this issue in the past clark and summers 1982 conclude that for teenagers unemployment and olf are not distinct states while flinn and heckman 1982a find the opposite for white male high school graduates the methodology adopted in this paper enables one to use incomplete transition data on unemployment and olf and to obtain estimates of the full transition matrix between three labor force states that are not possible with standard methods new evidence for high school graduates is presented by gender and it is found that while for young women the two states are distinct for young men they are not

sectoral money demand and the great disinflation in the united states estimates of the welfare costs of inflation based on bailey 1956 are typically computed using aggregate money demand models yet the behavior of money demand may vary across sectors thus the impact on welfare of inflation regime shifts may differ between households and firms we specifically investigate the sectoral welfare implications of the shift from the great inflation to the present regime of low and stable inflation for this purpose we estimate different functional specifications of money demand for u s households and nonfinancial firms using flow of fund data covering four decades we find that the benefits were significant for both sectors

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

is the environmental kuznets curve hypothesis a sound basis for environmental policy in africa achieving economic development and environmental sustainability simultaneously is one of the most important development challenges for africa today the relationship between economic growth and environmental sustainability is founded on the environmental kuznets curve ekc this paper examines the validity of the hypothesis and the driving factors of carbon dioxide co2 emission in five african countries using the stirpat empirical model panel cointegration and fully modified ordinary least squares unlike previous studies economic development is disaggregated into agriculture and industrial economic development the results show that there is no evidence of the validity of the hypothesis in africa regardless of whether economic development is driven by agriculture or industrialisation energy structure and energy intensity are the two major driving forces of co2 emissions in africa population growth and urbanisation have negative relationship with co2 emissions from our results the ekc is not a sound basis for environmental policy in africa rather environmental policy in africa specifically for co2 emissions mitigation should focus on encouraging energy efficiency enhancing the use of clean energy incorporating the impact of population growth and harnessing the positive impacts of urbanisation

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

stigma effects of nonemployment i introduction it is well known that longer durations of past nonemployment are associated with longer durations of future nonemployment 1 two explanations have been offered in the literature to interpret this phenomenon heterogeneity and the effect of workers employment histories the heterogeneity explanation argues that individuals differ in certain observed and unobserved characteristics and that these differences affect the duration of their periods of nonemployment however these individuals are unaffected by the mere experience of nonemployment because individuals with longer spells of nonemployment in the past are more likely to have characteristics that make them remain nonemployed they are likely to experience longer spells of nonemployment than others in the future the work history explanation argues that the mere experience of longer spells of nonemployment in the past raises the chance of longer spells of nonemployment in the future two theoretical explanations have been offered to explain this structural relationship human capital decay and stigma human capital decay suggests that nonemployed workers lose vital work experience and on the job training or suffer from human capital decay that reduces their future employability stigma suggests that potential employers infer the unobserved components of the workers quality from their history of employment and nonemployment in particular past nonemployment sends a negative signal to potential employers that lowers the probability of future reemployment 2 the ability to distinguish between heterogeneity and the effect of work history is a crucially important policy issue if the observed correlation between the duration of successive nonemployment spells reflects heterogeneity across individuals then a given individual enjoys the same chance of reemployment no matter how long or short his periods of past nonemployment have been in this case chronic nonemployment is a problem of a population subgroup and traditional training programs targeted toward the chronically nonemployed would be an appropriate policy tool moreover the programs could be targeted at individuals with the characteristics associated with a high risk of chronic nonemployment however if the observed correlation reflects the effect of work history anyone who happens to have experienced long periods of nonemployment in the past has a high probability of experiencing long periods of nonemployment in the future thus phelps 1972 argues that short term macroeconomic policies that alleviate unemployment will also lower aggregate unemployment rates in the long run 3 i argue however that an appropriate policy depends on the cause of the work history effect if the effect reflects human capital decay then short term macroeconomic policies to alleviate unemployment and traditional government training programs to help the unemployed restore lost skills are appropriate if the effect reflects stigma active short term macroeconomic policies may not be necessary to lower aggregate unemployment rates in the long run because stigma effects are likely to be weaker when nonemployment is experienced during a severe recession than when it is experienced during a moderate recession an appropriate policy would aim at aiding the flow of accurate information on the quality of stigmatized workers in the private sector for instance the government might subsidize potential private sector employers costs of screening job applicants who established poor work histories during a period of moderate recession alternatively it might sponsor private sector internship and training programs for such workers 4 although both the duration and frequency of nonemployment determine the individual s nonemployment rate the duration is empirically far more important than the frequency 5 because an understanding of the determinants of the duration of nonemployment is crucial to both economic theory and policymaking an enormous number of empirical studies have addressed the issue

the measurement of unemployment an empirical approach although the unemployment rate is one of the most widely cited and closely monitored economic statistics the definition and measurement of unemployment remain controversial an important issue is whether non employed persons who display a marginal attachment to the labor force for example those who are available for and desire work but are not searching for work should be classified as unemployed or non participants although this issue has been extensively debated it has never been tested empirically this paper carries out empirical tests of this and related hypotheses using a unique longitudinal data set from canada we find within the marginally attached a waiting group whose behavior indicates that they would be more appropriately classified as unemployed rather than out of the labor force the remainder of the marginally attached exhibit behavior between that of the unemployed and the balance of non participants suggesting that the desire for work among non searchers conveys substantial information about labor force attachment and future employment status our methods also apply to heterogeneity within the unemployed and we investigate behavioral variation linked to differences in job search methods and reasons for entry into unemployment although those using passive job search do exhibit behavior somewhat distinct from active searchers our results reject the practice of classifying passive job searchers as out of the labor force overall our results indicate that the non employed are very heterogeneous so that any single division into unemployment and out of the labor force is unlikely to fully capture the variety of degrees of labor force attachment this abstract was borrowed from another version of this item

u s narrow money for the twenty first century i introduction though money retains its fundamental role in a market economy money measures have been noticeably de emphasized within the conduct of u s monetary policy the federal open market committee fomc stopped reporting annual growth objectives for monetary aggregates although it states that money supply still has value for gauging economic conditions board of governors 2000 however a growing body of research calls for returning monetary aggregates to a more prominent role within monetary policy meltzer 1998 asserts that the view of persistent money growth as being the source of inflation is again widely accepted perhaps more firmly held by some central bank governors now than at any time in the twentieth century nelson 2002 provides evidence that base money has a significant effect on output relative to potential in the united states and united kingdom even after controlling for the short term real interest rate nelson 2003 argues that money growth governs the mean and dynamics of inflation in present day new keynesian models leeper and roush 2003 find evidence of an essential role for m2 within the transmission of monetary policy even after controlling for the nominal interest rate 1 this article focuses on the role of sweep programs in properly measuring narrow money in a sweep program banks move a portion of funds from customer demand deposits dds or other checkable deposits ocds into instruments with zero statutory reserve requirements we examine the effects of two types of sweep programs in the united states retail sweep programs and commercial demand deposit sweep programs narrow transactions based money historically has played a key role in the conduct of monetary policy as hafer and wheelock 2001 explain m1 served as the measure of money within the st louis model although monetarists had long been divided over whether a narrow or broad aggregate was the preferable target for monetary policy the fomc appeared to focus on m1 during the 1970s and early 1980s publishing their target ranges for money growth in terms of m1 hafer and wheelock 2001 though state that deviations in m1 velocity from its upward trend beginning in the early 1980s caused instability within the st louis model hoffman and rasche 1991 and hoffman et al 1995 place dummy variables in their vector error correction mechanisms to capture observed shifts in m1 velocity what attention remains on the money supply seems to be focused on broad rather than narrow aggregates but the broad aggregates have not escaped difficulties duca 2000 and hafer and wheelock 2001 document a deviation of m2 velocity from its long run trend in the early 1990s sometimes characterized as the missing m2 episode duca and vanhoose 2004 state that one response was to replace m2 with mzm consistent with the view that heightened substitution between small time deposits and mutual funds other than money market mutual funds mmmfs largely accounted for the instability in m2 velocity but as they go on to discuss m2 and mzm velocity encountered problems in the early 2000s plunging in ways not in line with opportunity cost variables duca and van hoose 2004 state that broader aggregates may have become more vulnerable to portfolio substitution involving stock and mutual funds other than mmmf narrow money has also been used extensively in examining money demand a sizable body of research has emerged that empirically investigates the demand for m1 especially using cointegration techniques hoffman and rasche 1991 hoffman et al 1995 dutkowsky and atesoglu 2001 and ball 2001 provide evidence of a stable long run money demand equation using m1 ball 2002 generates further support with m1 and establishes a correspondence between the partial adjustment formulation and the vector error correction model yet research and policy making using narrow money is currently being hampered by the lack of an accurate measure of transactions based money

water use and economic growth reconsidering the environmental kuznets curve relationship abstract predictions of national and global water use have been criticized for being inaccurate and for not taking into consideration economic development of the little research that does address water use as a function of economic development results are inconsistent but much claims to find clear evidence of an environmental kuznets curves ekc or inverted u type relationship this research attempts to elucidate the relationship between income growth and freshwater use by a evaluating a variety of cross sectional and panel datasets on water withdrawals and consumptive use b employing both traditional least squares and non parametric regression analysis the latter of which offers the advantage of not assuming a given functional form c testing both per capita and total water use and d comparing water withdrawals to consumptive use the research finds some support for the existence of an ekc but results are highly dependent on choice of datasets and statistical technique results are also sector specific and ekc curves prove to be poor indicators of individual country behavior as such the study points to limitations of ekcs in terms of water use policy and planning

the welfare cost of inflation in general equilibrium abstract this paper presents a general equilibrium monetary model in which inflation distorts a variety of marginal decisions although individually none of the distortions is very large they combine to yield substantial welfare cost estimates a sustained 4 percent inflation like that experienced in the us since 1983 costs the economy the equivalent of 0 41 percent of output per year when currency is identified as the relevant definition of money and over 1 percent of output per year when m1 is defined as money the results illustrate how the traditional partial equilibrium approach can seriously underestimate the true cost of inflation

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

detailed estimation of worklife expectancy for the measurement of human capital accounting for marriage and children abstract measuring an individual s human capital at a point in time as the present actuarial value of expected net lifetime earnings has a lengthy history calculating such measures requires accurate estimates of worklife expectancy here worklife estimates for men and women in the usa categorized by educational attainment race marital status parental status and current labour force status are presented race has a much larger impact on the worklife expectancy of men than women education is associated with larger worklife differentials for women the association between marriage and worklife expectancy is significant but of opposite sign for men and women married women men have a lower higher worklife expectancy than single women men parenthood is associated with a reduction in the worklife expectancy of women the association is smaller and varies from positive for some education marital status groups to negative for others for men

sectoral money demand a co integration approach the major emphasis in previous money demand studies has been at the aggregate level with little systematic attention paid to sectoral differences in money holding behavior this paper attempts to address the latter issue by focusing on more homogeneous subgroups to gauge money holding patterns we apply cointegration theory to identify long run money demand functions for the household and business sectors of the u s economy in general our results which are based on the 1960 1990 u s monetary experience suggest substantial sectoral divergences in long run relationships in particular the household sector reveals more stable relationships the business sector indicates strong interest elasticities which are found to be negligible for the household case these findings are invariant to alternative money definitions and for different sample periods copyright 1994 by mit press