Cyclical Unemployment: Sectoral Shifts or Aggregate Disturbances?
| Title: | Cyclical Unemployment: Sectoral Shifts or Aggregate Disturbances? |
| Author: |
Abraham, Katharine G.; Katz, Lawrence F.
Note: Order does not necessarily reflect citation order of authors. |
| Citation: | Abraham, Katharine G., and Lawrence F. Katz. 1986. Cyclical unemployment: Sectoral shifts or aggregate disturbances? Journal of Political Economy 94(3) Part 1: 507-522. |
| Full Text & Related Files: |
Katz_CyclicalUnemployment.pdf (469.5Kb; PDF) 
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| Abstract: | Recent work by David Lilien has argued that the positive correlation between the dispersion of employment growth rates across sectors (a) and the unemployment rate implies that sectoral shifts in labor demand are responsible for a substantial fraction of cyclical variation in unemployment. This paper demonstrates that, under empirically satisfied conditions, traditional single-factor business-cycle models will produce a positive correlation between (sigma) and the unemployment rate. Information on the job vacancy rate permits one to distinguish between a pure sectoral shift and a pure aggregate demand interpretation of this positive correlation. The finding that a and the volume of help wanted advertising (a job vacancy proxy) are negatively related supports an aggregate demand interpretation. |
| Published Version: | http://www.jstor.org/stable/1833046 |
| Terms of Use: | This article is made available under the terms and conditions applicable to Other Posted Material, as set forth at http://nrs.harvard.edu/urn-3:HUL.InstRepos:dash.current.terms-of-use#LAA |
| Citable link to this page: | http://nrs.harvard.edu/urn-3:HUL.InstRepos:3442781 |
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