Reassessing the NAIRUs after the Crisis
The financial crisis has resulted in a substantial increase in unemployment in the OECD. This paper shows that this increase has reversed the reduction in structural unemployment which has been estimated to have occurred in most OECD countries since the late 1990s. Structural unemployment is defined...
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| Format: | eBook |
| Language: | English |
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Paris
OECD Publishing
2011
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| Series: | OECD Economics Department Working Papers
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| Collection: | OECD Books and Papers - Collection details see MPG.ReNa |
| Summary: | The financial crisis has resulted in a substantial increase in unemployment in the OECD. This paper shows that this increase has reversed the reduction in structural unemployment which has been estimated to have occurred in most OECD countries since the late 1990s. Structural unemployment is defined as a time-varying NAIRU derived from the information contained in a reduced Phillips curve equation (linking inflation to the unemployment gap) by means of a Kalman filter. The overall limited revisions in historical NAIRU estimated in 2008 after such a large labour market shock support the robustness of the OECD approach. This approach is therefore extended to almost all OECD countries. Alternative specifications of the Phillips curve are proposed for some specific groups of countries |
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| Physical Description: | 27 p. 21 x 29.7cm |