The Impact of TFP Growth on Steady-State Unemployment
Christopher Pissarides () and
Giovanna Vallanti ()
No 5002, CEPR Discussion Papers from C.E.P.R. Discussion Papers
Theoretical predictions of the impact of TFP growth on unemployment are ambiguous, and depend on the extent to which new technology is embodied in new jobs. We evaluate a model with embodied and disembodied technology, capitalization, and creative destruction effects by estimating the impact of TFP growth on unemployment in a panel of industrial countries. We find a large negative impact which implies that embodied technology and creative destruction play no role in the steady-state dynamics of unemployment. Capitalization effects explain some of the estimated impact but a part remains unexplained.
Keywords: capitalization effect; creative destruction; embodied technology; TFP growth; unemployment (search for similar items in EconPapers)
JEL-codes: E24 J64 O51 O52 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-dev, nep-dge and nep-mac
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Journal Article: THE IMPACT OF TFP GROWTH ON STEADY-STATE UNEMPLOYMENT (2007)
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