growth and unemployment this paper analyses the effects of growth on long run unemployment using a search model of equilibrium unemployment where growth arises explicitly from the introduction of new technologies that require labour reallocation for their implementation the analysis uncovers and compares between two competing effects of growth on unemployment the first is a capitalisation effect whereby an increase in growth raises the capitalised returns from creating jobs and consequently reduces the equilibrium rate of unemployment the second is a creative destruction effect whereby an increase in growth reduces the duration of a job match thereby raising the equilibrium level of unemployment both directly by raising the job separation rate and indirectly by discouraging the creation of job vacancies this paper asks the question of how the rate of economic growth affects unemployment in the long run the main consideration that leads us to think that this is an interesting question has to do with the re allocative aspect of growth in the long run faster economic growth must come from a faster increase in knowledge to the extent that the advancement of knowledge is embodied in industrial innovations it is likely to raise the job destruction rate through automation skill obsolescence and the bankruptcy associated with the process of creative destruction in short increased growth is likely to produce an increased rate of job turnover and the search theories of lucas and prescott 1974 and pissarides 1990 imply that an increased rate of job turnover will result in a higher natural rate of unemployment this conclusion is also consistent with the empirical results of davis and haltiwanger 1990 which show that periods of high unemployment tend to be periods of high job turnover at the establishment level it suggests the possibility of a positive longrun tradeoff between growth and unemployment at least over some range there has been relatively little attention paid to our question in the literature on longrun determinants of unemployment for example the recent empirical examination by layard nickell and jackman 1991 of unemployment rates among oecd countries did not even consider the rate of economic growth as a possible explanatory variable this is consistent with the seminal theoretical work of phelps 1968 which implies that the natural rate of unemployment is independent of the rate of productivity growth the only

el precio de los terrenos y el valor de sus atributos un enfoque de precios hedonicos o one of the most interesting characteristics in urban plots markets is that differentiated products are traded in integrated markets urban plots are composite goods whose utility for the consumer depends on the utility yield by each one of the characteristics or attributes that compose them the technique used to study the contributions of each one of those characteristics to the market price of urban plots in the city of san miguel of tucuman is the econometric estimation of hedonic equations whose regressors are the attributes of the urban plots it is found that location variables commercial areas and commercial surroundings have the greatest impact on prices on the other hand variables associated with the availability of public utilities are less important it is also found that the price per square meter diminishes as the size of the urban plot increases this is consistent with the results obtained by figueroa and lever for the case of santiago de chile

the ins and outs of european unemployment in this paper we study the contribution of inflows and outflows to the dynamics of unemployment in three european countries the united kingdom france and spain all countries are interesting in their own right and in the comparison with each other britain s labour markets were strictly regulated up to the mid 1980s but they have been liberalized since then france is still a regulated economy compared with britain with unemployment averaging about 8 spain has had the biggest rise in unemployment in europe reaching 24 in the mid 1990s but policy reforms and fast growth since then brought it down to a level below france s we compare performance in these three countries making use of both administrative and labor force survey data we find that the impact of the 1980s reforms in britain is evident in the contributions of the inflow and outflow rates the inflow rate became a bigger contributor after the mid 1980s although its significance subsided again in the late 1990s and 2000s in france the dynamics of unemployment are driven by the outflow rate virtually entirely which is consistent with a regime with strict employment protection legislation in spain however both rates contribute significantly to the dynamics perhaps as a consequence of the prominence of fixed term contracts since the late 1980s

productivity and unemployment over the business cycle abstract the low correlation between cyclical unemployment and productivity over the post war period hides a large sign switch in the mid 1980s from significantly negative the correlation became significantly positive using a search model of unemployment with nominal rigidities and variable labor effort i show that technology shocks can generate a positive unemployment productivity correlation whereas non technology shocks i e aggregate demand shocks tend to do the opposite in this context i identify two events that can quantitatively explain the increase in the correlation i a sharp drop in the volatility of non technology shocks in the mid 1980s and ii a decline in the response of productivity to non technology shocks which from procyclical became acyclical in the last 25 years

the ins and outs of uk unemployment this study shows that in the uk increases in unemployment in a recession are driven by rises in the separation rate a new decomposition of unemployment dynamics is devised that does not require unemployment to be in steady state at all times this is important because low uk transition rates one quarter the size of the us imply substantial deviation of unemployment from steady state near cyclical turning points in periods of moderation the job finding rate is shown to have most influence on uk unemployment dynamics evidence comes from the first study of monthly data derived from individuals labour market spells recorded in the british household panel survey from 1988 to 2008

pricing and financial resources an analysis of the disk drive industry 1980 88 this paper empirically examines the long purse hypothesis formalized by patrick bolton and david scharfstein 1990 that incumbents may drive out entrants through aggressive pricing the author analyzes the pricing of 733 disk drives between 1980 and 1988 drives that are adjacent to those manufactured by thinly capitalized undiversified rivals are priced lower than other drives during the later years in the sample when little equity financing was available to these firms the results are robust to controls for alternative hypotheses and to other specifications of the hedonic regression copyright 1995 by mit press

job destruction and propagation of shocks this paper considers propagation of aggregate shocks in a dynamic general equilibrium model with labor market matching and endogenous job destruction cyclical fluctuations in the job destruction rate magnify the output effects of shocks as well as making them much more persistent interactions between capital adjustment and the job destruction rate play an important role in generating persistence propagation effects are shown to be quantitatively substantial when the model is calibrated using job flow data incorporating costly capital adjustment leads to significantly greater propagation

group health insurance a hedonic price approach the authors examine the premium consequences of alternative health insurance provisions by estimating pricing regressions for group insurance with data on 9 019 fee for service plans offered by larger firms in the private sector they find that cost sharing at the point of purchase especially for hospital care significantly lowers fee for service premiums however some aspects of plan design that are often touted as cost reducing such as self insuring or offering employees the option to join a health maintenance organization are found to increase premiums coverage of alcoholism chemical dependency treatments inpatient mental health care and psychologists services which are mandated in many states are found to be expensive copyright 1990 by mit press

the cyclicality of labor market flows a multiple shock approach abstract in this paper we aim to establish some stylized facts about the relative contributions of the job finding and separation rates to unemployment dynamics depending on the nature of structural shocks the shocks in our bayesian structural var model are identified using a sign restriction approach and capture shifts in the three conditions determining labor market equilibrium in matching models the beveridge curve and the job creation and job destruction conditions using both us and french data we identify an aggregate shock to match profitability the aggregate profitability shock a shock specific to existing jobs the reallocation shock and a shock to the efficiency of the matching process the matching efficiency shock we find that the relative contributions of the job finding and separation rates are notably different across shocks in both countries but are similar across countries for each type of shock labor market dynamics appear to be transatlantic despite well known institutional differences however it must be emphasized that the reaction of the labor market variables to the matching efficiency shock seems more muted in the us than in france

the cyclicality of separation and job finding rates this paper uses cps gross flow data to analyze the business cycle dynamics of separation and job finding rates and to quantify their contributions to overall unemployment variability cyclical changes in the separation rate are negatively correlated with changes in productivity and move contemporaneously with them while the job finding rate is positively correlated with and tends to lag productivity contemporaneous fluctuations in the separation rate explain between 40 and 50 percent of fluctuations in unemployment depending on how the data are detrended this figure becomes larger when dynamic interactions between the separation and job finding rates are considered

technology shocks and job flows we consider a version of the solow growth model where technological progress can be investment specific or investment neutral the labour market is subject to search frictions and the existing productive units may fail to adopt the most recent technological advances technological progress can lead to the destruction of technologically obsolete jobs and cause unemployment we calibrate the model to replicate the high persistence that characterizes the dynamics of firms neutral technology and the frequency of firms capital adjustment we find that neutral technological advances increase job destruction and job reallocation and reduce aggregate employment investment specific technological advances reduce job destruction have mild effects on job creation and are expansionary hence neutral technological progress prompts schumpeterian creative destruction while investment specific technological progress operates essentially as in the standard neoclassical growth model using structural var models we provide support to the key dynamic implications of the model copyright 2007 wiley blackwell

on the driving forces behind cyclical movements in employment and job reallocation theory restricts short run job creation and destruction responses and cumulative employment and job reallocation responses to allocative and aggregate shocks we formulate these restrictions and implement them for postwar data on u s manufacturing allocative shocks are the main driving force behind cyclical movements in job reallocation but their contribution to employment fluctuations varies greatly across alternative identification assumptions also the data compel one or both of the following inferences aggregate shocks greatly alter the shape and not just the mean of the cross sectional density of employment growth rates allocative shocks cause short run reductions in aggregate employment

trends and contagion in wti and brent crude oil spot and futures markets the role of opec in the last decade abstract this article examines the interconnectedness of wti and brent prices on different resolutions of price movements firstly within a multivariate bekk framework we identify high but volatile correlations with recurring highs around 0 8 and multiple periods of decoupling opec meetings increase the correlation in the short run secondly linear l1 trends reveal that long term movements of wti and brent are driven by the same dynamics confirming the one great pool hypothesis opec meetings have only little impact on long term price trends thirdly we find leading effects of wti over brent by short term trends of several days especially in a negative direction these trends have an asymmetrical effect on volatility negative trends cause a stronger increase than positive trends these findings are of interest to policy makers as well as hedging strategies of crude oil portfolios and provide insight into long term movements of crude prices

dynamics of worker flows and vacancies evidence from the sign restriction approach this paper establishes robust dynamic features of the worker reallocation process in the us labor market i use structural vars with sign restrictions which take the form of restricting the short run negative relationship between vacancies and unemployment i e beveridge curve despite the weakness of these restrictions they reveal a clear unambiguous pattern that when unemployment increases and vacancies drop i both the separation rate and gross separations rise quickly and remain persistently high ii the job finding rate and vacancies drop in a hump shaped manner and iii gross hires respond little initially but eventually rise these results point to the importance of job loss in understanding us labor market dynamics this pattern also holds with respect to different kinds of shocks that induce the same beveridge curve relationship this paper also considers the disaggregate model which uses data disaggregated into six demographic groups and incorporates transitions into and out of the labor force i show that the separation rate continues to play a dominant role among prime age male workers while for other groups changes in the job finding rate are more important copyright 2009 john wiley sons ltd

sectoral shifts and cyclical unemployment a substantial fraction of cyclical unemployment is better characterized as fluctuations of the frictional or natural rate than as deviations from some relatively stable natural rate shifts of employment demand between sectors of the economy necessitate continuous labor reallocation since it takes time for workers to find new jobs some unemployment is unavoidable this paper presents evidence that most of the unemployment fluctuations of the seventies unlike those in the sixties were induced by unusual structural shifts within the u s economy simple time series models of layoffs and unemployment are constructed that include a measure of structural shifts within the labor market these models are estimated and a derived natural rate series is constructed

business cycle measurement with some theory a method to evaluate cyclical models not requiring knowledge of the dgp and the exact specification of the aggregate decision rules is proposed we derive robust restrictions in a class of models use some to identify structural shocks in the data and others to evaluate the class or contrast sub models the approach has good properties even in small samples and when the class of models is misspecified the method is used to sort out the relevance of a certain friction the presence of rule of thumb consumers in a standard class of models

dynamics of part time employment to an aggregate shock a sign restriction approach abstract this paper provides new stylized facts about the responses of the part time employment share the transition probability from full time to part time and the one from part time to full time jobs to a negative aggregate shock the recessionary aggregate shock is identified within a sign restriction var framework by imposing a short run negative co movement between unemployment and vacancies the negative aggregate shock pushes the part time employment share up the latter increase is mainly due to a rise in the probability at which full time work is transformed into part time work without an intervening spell of unemployment given that such transitions mainly take place at the same firm worker pair these findings indicate that us firms use in addition to the creation destruction process within employment reallocation to adjust their labor input in recessionary episodes

on the price of land and the value of amenities a house represents not only a bundle of structural characteristics but also a set of location specific characteristics adding locational coordinates and site area to other house characteristics makes it possible to estimate a land rent surface as well as thle hedonic prices attached to local patterns of land use and other neighbourhood characteristics one can then estimate how the value of such location specific characteristics are capitalized into land prices this analysis illustrated with estimates based on data from two british towns has a number of wider implications it generates a more parsimonious method of estimating amenity values it also reveals likely systematic biases produced by conventional hedonic studies which exclude land and location finally it clarifies the conceptual definition of land and suggests that monocentric models can perform well despite recent criticism

measuring the performance of a protected infant industry the case of brazilian microcomputers until the beginnings of the collor presidency in 1990 the brazilian government strongly protected domestic producers of electronics goods using hedonic methods the authors analyze systematic evidence of the performance of the brazilian microcomputer industry and compare it with international standards their analysis highlights rapid rates of advance in brazil but lower rates than potential international competition technical frontiers typically lagged price performance practices in international markets by at least three years and by as much as five foregone buyer surplus due to protection had to be quite high approaching 20 percent of domestic expenditure on microcomputers copyright 1995 by mit press

unemployment and vacancies with sectoral shifts recent analyses of unemployment vacancy series suggest that aggregate shocks rather than sectoral shocks are the primary factors responsible for unemployment fluctuations this inference follows from two widely held beliefs sectoral shocks induce only positive unemployment vacancy comovements while negative comovements are necessarily the result of aggregate demand shocks this paper describes an equilibrium matching model that identifies plausible circumstances in which neither assumption is correct thus suggesting that unemployment vacancy data are inconclusive interestingly this model s novel results are due to standard features in the contracting literature firms experience relative price shocks and negotiate contracts that prescribe temporary layoffs copyright 1994 by american economic association

building a composite help wanted index abstract this paper builds a measure of vacancy posting over 1951 2009 that captures the behavior of total print and online help wanted advertising and can be used for time series analysis of the us labor market

the ins and outs of unemployment an analysis conditional on technology shocks we analyze how unemployment job finding and job separation rates react to neutral and investment specific technology shocks neutral shocks increase unemployment and explain a substantial portion of it volatility investmentspecific shocks expand employment and hours worked and contribute to hours worked volatility movements in the job separation rates are responsible for the impact response of unemployment while job finding rates for movements along its adjustment path the evidence warns against using models with exogenous separation rates and challenges the conventional way of modelling technology shocks in search and sticky price models

hedonic prices demands for urban housing amenities and benefit estimates abstract this paper uses a rosen two step hedonic price trait demand approach to estimate demand functions for a vector of urban amenities to ascertain whether this theoretically preferred approach yields benefit estimates which differ from the oft used ridker henning one step hedonic approach we conduct a sensitivity analysis we find that the two step approach does yield different benefit estimates and that the differences are large for some amenities the estimates are sensitive to the functional form of the hedonic equation when the forms are significantly different according to modified box cox results but are not particularly sensitive to specification of the amenity demand equation

improving hedonic estimation with an inequality restricted estimator economists commonly estimate the value of characteristics not traded in explicit markets by hedonic pricing unfortunately these nonexplicitly traded characteristics often display a lack of independent variation or multicollinearity often some prior information on the value of these characteristics is available from submarkets this paper utilizes this type of prior information to circumvent multicollinearity problems in hedonic pricing models using an inequality restricted bayesian estimator the authors perform a monte carlo experiment and cross validation analysis to demonstrate the superiority of inequality restricted bayesian over ordinary least squares at many margins in a variety of situations typically faced in hedonic estimation copyright 1995 by mit press

business cycles and labor market search the quantitative implications of labor market search for economic fluctuations are evaluated in the context of a real business cycle model incorporating labor market search into the model is found to improve its empirical performance along several dimensions in particular hours now fluctuate substantially more than wages and the contemporaneous correlation between hours and productivity falls in addition the model replicates the observation that output growth displays positive autocorrelation at short horizons overall the empirical results suggest that the labor market search environment embodies a quantitatively important propagation mechanism copyright 1996 by american economic association

the practice of econometrics classic and contemporary provides hands on experience of econometrics with estimation and inference each chapter begins with a discussion of economic theory underlying the application

the cyclicality of the separation and job finding rates in france abstract in this paper we shed light on the relative contribution of the separation and job finding rates to french unemployment at business cycle frequencies by using administrative data on registered unemployment and labor force surveys we first investigate the fluctuations in steady state unemployment and then in current unemployment in order to take into account the unemployment deviations from equilibrium both data sets lead to quite similar results both rates contributed to unemployment fluctuations during the nineties 50 50 split while in the last decade the job finding rate was more significant and explained around 65 of the french unemployment fluctuations in particular the last business cycle episode including the last recession exacerbated the role of the job finding rate we then show that the predominant role of the job finding rate in the last decade holds when the economy is hit by aggregate business cycle shocks moving unemployment and vacancies along the beveridge curve

the replacement problem in frictional economies a near equivalence result we examine how technological change affects wage inequality and unemployment in a calibrated model of matching frictions in the labor market we distinguish between two polar cases studied in the literature a creative destruction economy where new machines enter chiefly through new matches and an upgrading economy where machines in existing matches are replaced by new machines our main results are i these two economies produce very similar quantitative outcomes and ii the total amount of wage inequality generated by frictions is very small we explain these findings in light of the fact that in the model calibrated to the us economy both unemployment and vacancy durations are very short i e the matching frictions are quantitatively minor hence the equilibrium allocations of the model are remarkably close to those of a frictionless version of our economy where firms are indifferent between upgrading and creative destruction and where every worker is paid the same market clearing wage these results are robust to the inclusion of machine specific or match specific heterogeneity into the benchmark model jel j41 j64 o33

employment efficiency and sticky wages evidence from flows in the labor market i consider three views of the labor market in the first wages are flexible and employment follows the principle of bilateral efficiency workers never lose their jobs because of sticky wages in the second wages are sticky and inefficient layoffs do occur in the third wages are also sticky but employment governance is efficient i show that the behavior of flows in the labor market strongly favors the third view in the modern u s economy recessions do not begin with a burst of layoffs unemployment rises because jobs are hard to find not because an unusual number of people are thrown into unemployment

hedonic prices for a nondurable good the case of breakfast cereals numerous studies have estimated hedonic price functions for durable goods in this paper the authors apply the methodology to breakfast cereals a nondurable good they employ maximum likelihood to estimate the hedonic price functions using data from three large supermarkets the price function depends on characteristics that provide taste nutrition and convenience to consumers and the estimates yield insights into pricing policies consumer preferences and consumer use of information copyright 1991 by mit press