Abstract
According to Alan Blinder (1989, p. 143), unemployment poses two challenges to economics: (1) definition and (2) theoretical explanation. This paper is almost entirely about the first challenge, i.e. it focuses on definition and measurement issues and establishes some facts about unemployment in an international comparative perspective. However, there can be no definition and no facts without theory and hopefully no economic theory independent of facts. Definition and measurement are particularly important where international comparative analysis is used to investigate the impact of institutional arrangements on economic performance. A good example is the European (German) view that the US has performed better in terms of unemployment than the German economy, a contention true only of the late 1980s and the 1990s. In all other periods, Germany’s unemployment performance emerges as clearly superior, provided that unemployment is measured in a comparable way and the unemployment rate is computed using the same formula (see section 3).
We are grateful to Hilla Dotan for research assistance.
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Schettkat, R., Verhagen, M. (2000). International Unemployment Trends: Measurement and Stylized Facts. In: Wagner, H. (eds) Globalization and Unemployment. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-662-04082-9_4
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