Empirical Economics

, Volume 21, Issue 4, pp 589–600 | Cite as

Unemployment hysteresis - macro evidence from 16 OECD countries

  • Knut Røed
Article
Received:
Revised:

Abstract

This paper investigates empirically the presence ofunemployment hysteresis in 16 OECD countries, applying aggregate quarterly unemployment rates covering the past 25 years. Alternative test procedures are discussed and employed, posing both stationarity and hysteresis as null hypotheses. The results suggest that hysteresis effects are highly significant in Australia and Canada, and to a lesser extent also significant in most European countries and in Japan. Only in the USA, the presence of unemployment hysteresis is strongly and consistently rejected.

Keywords

Hysteresis unemployment unit root 

JEL Classification System-Numbers

C22 E24 
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Copyright information

© Physica-Verlag 1996

Authors and Affiliations

  • Knut Røed
    • 1
  1. 1.Department of EconomicsUniversity of OsloOsloNorway

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