Forecasting Employment for Germany

Darius Hinz () and Camille Logeay
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Darius Hinz: University of Bielefeld (Student)

No 01-2006, IMK Working Paper from IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute

Abstract: This paper deals with the estimation of employment equations for Germany, which are to be used for forecasting and simulation purposes. The authors estimate both single and system error correction equations for German working hours using quarterly raw data covering the period 1980:1-2004:2. Since the focus is on the question whether German reunification has affected or even modified the underlying economic relationships, the authors compare the results to those reported in previous studies for West Germany and Germany, respectively. The authors find that the elasticity of employment with respect to output is robustly estimated and can therefore be restricted to one. The elasticity of employment with respect to the real wage, however, is affected by German reunification and relative factor prices no longer play a significant role. The forecasting quality of the employment equation is satisfactory.

Keywords: employment; forecasting; cointegration; Germany (search for similar items in EconPapers)
JEL-codes: C22 C32 C53 E24 E27 (search for similar items in EconPapers)
Pages: 37 pages
Date: 2006, Revised 2006-01
New Economics Papers: this item is included in nep-for and nep-mac
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Persistent link: https://EconPapers.repec.org/RePEc:imk:wpaper:01-2006

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