New evidence on cyclical and structural sources of unemployment
Zinzhu Chen,
Prakash Kannan (),
Prakash Loungani and
Bharat Trehan ()
No 2011-17, Working Paper Series from Federal Reserve Bank of San Francisco
Abstract:
We provide cross-country evidence on the relative importance of cyclical and structural factors in explaining unemployment, including the sharp rise in U.S. long-term unemployment during the Great Recession of 2007-09. About 75% of the forecast error variance of unemployment is accounted for by cyclical factors?real GDP changes (?Okun?s Law?), monetary and fiscal policies, and the uncertainty effects emphasized by Bloom (2009). Structural factors, which we measure using the dispersion of industry-level stock returns, account for the remaining 25 percent. For U.S. long-term unemployment the split between cyclical and structural factors is closer to 60-40, including during the Great Recession.
Keywords: Unemployment (search for similar items in EconPapers)
Date: 2011
New Economics Papers: this item is included in nep-lab and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (22)
Downloads: (external link)
http://www.frbsf.org/publications/economics/papers/2011/wp11-17bk.pdf (application/pdf)
Related works:
Journal Article: New evidence on cyclical and structural sources of unemployment (2012) 
Working Paper: New Evidenceon Cyclical and Structural Sources of Unemployment (2011) 
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
HTML/Text
Persistent link: https://EconPapers.repec.org/RePEc:fip:fedfwp:2011-17
Ordering information: This working paper can be ordered from
Access Statistics for this paper
More papers in Working Paper Series from Federal Reserve Bank of San Francisco Contact information at EDIRC.
Bibliographic data for series maintained by Federal Reserve Bank of San Francisco Research Library ().