It's all the miners' fault: On the nonlinearity in U.S. unemployment rates

Gawon Yoon

Economic Modelling, 2009, vol. 26, issue 6, 1449-1454

Abstract: The U.S. unemployment rate is generally regarded as nonlinear. In this study, we show that if there had been no miners' general strike in October of 1949, and if the aggregate unemployment rate had been 0.3% lower during that month, the 1948-2002 U.S. unemployment rate would have been linear. Hence, just a single alteration of past events would have resulted in significantly different findings regarding the linearity in the U.S. unemployment rate. This finding illustrates a need for linearity tests to be developed that are robust against the effects of outliers.

Keywords: (Non)linearity; Unemployment; rate; Outliers; Robustness (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (3)

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