Unemployment Dynamics, and Propagation of Aggregate and Reallocation Shocks in the Netherlands

This paper models the propagation at the macro level of four types of shocks using the SVAR approach. Time series data for the Netherlands on job creation, job destruction, the number of vacancies and labour supply are used to identify aggregate demand and supply shocks, and reallocation demand and supply shocks as different sources of unemployment dynamics. Each of these four types of shocks appears to have at least some influence on unemployment both in the short and long run. The long run influence of the aggregate labour supply shock is estimated to be very limited. It indicates that additional labour supply is almost fully absorbed by labour demand in the long run.     

Interaction between structural and cyclical shocks in production and employment

Interaction between Structural and Cyclical Shocks in Production and Employment. — A major aim of recent empirical modelling of the business cycle is to identify the relative importance of aggregate supply and demand shocks. This paper uses the methodology of unobserved (or structural) components time series models for the identification of technology and demand shocks in a two-equation system of structural labour productivity and industrial output. It allows us to introduce the correlation between the structural and cyclical shocks such that the mutual dependency of these shocks can be estimated explicitly. The data is quarterly time series of labour productivity in industry and industrial output for Germany, the Netherlands, the United Kingdom and the United States. Our results show that the covariance of the dynamics of structural and cyclical shocks appears to be important in these countries.     

The division of labour is limited by the type of market: The case of the Taiwanese machine tool industry

This paper seeks to illustrate that the division of labour is limited not only by the size of the market, i.e. aggregate purchasing power, but also by the type of market, i.e. the average income of individual consuming units. Consequently, for technology to advance in the production of certain goods, capital accumulation must occur. The multiplication of markets alone is insufficient. Empirical support for this proposition is provided by an examination of the Taiwanese machine tool industry. Central to the discussion is the treatment of the product as an economic variable.     

FDI and the labour market: a review of the evidence and policy implications

This paper presents a series of results concerning the labour-marketimpact of inward foreign direct investment (FDI) in the UK.The paper demonstrates that one of the crucial impacts of FDIis to increase wage inequality and the use of relatively moreskilled labour in the domestic firms. This result is found tobe a combination of two effects. First, the entry by a multinationalenterprise (MNE) increases the demand for skilled workers inan industry or region, thus increasing wage inequality. Second,technology spillovers occur from foreign to domestic firms.As a result of these spillovers, relative demand for skilledworkers increases in the domestic firms, further contributingto aggregate wage inequality and skill upgrading. The paperalso considers how FDI impacts upon skill shares by productivitydifferentials between foreign and domestic firms. Finally, thepolicy implications of this are discussed, from the perspectiveof regional development, and the likely effectiveness of attractingFDI to reduce structural unemployment.     

Labour Market Asymmetries in a Monetary Union

This paper takes a first step in analysing how a monetary union performs in the presence of labour market asymmetries. Differences in wage flexibility, market power and country sizes are allowed for in a setting with both country-specific and aggregate shocks. The implications of asymmetries for both the overall performance of the monetary union and the country-specific situation are analysed. It is shown that asymmetries are not only critical for country-specific performance but also for the overall performance of the monetary union. A striking finding is that aggregate output volatility is not strictly increasing in nominal rigidities but hump-shaped. Moreover, a disproportionate share of the consequences of wage inflexibility may fall on small countries. In the case of country-specific shocks, a country unambiguously benefits in terms of macroeconomic stability by becoming more flexible, while this is not necessarily the case for aggregate shocks. There may thus be a tension between the degree of flexibility considered optimal at the country level and at the aggregate level within the monetary union.     

Catching up with the Technology Frontier: Finnish Manufacturing Productivity, 1975–2003

Abstract

Labour productivity in Finnish manufacturing industry grew at the rapid average annual rate of 5 per cent from 1975 to 2003. The labour productivity growth was broad-based, or yeast-like, in the 1970s and 1980s, with contributions from multi-factor productivity gains in the paper and metal industries dominating. In the 1990s productivity growth was much more mushroom-like, that is, concentrated in the electronics industry. The level of labour productivity in Finnish manufacturing matched that of the USA by the end of the second millennium. Labour costs and unit labour costs remained at only three-quarters of the US level, although real hourly compensation increased steadily. After 1995 manufacturing industry constituted a quarter of the Finnish economy but contributed a third of overall economic growth.     

A Model of the Optimal Tax Mix Including Capital Taxation

Atlantic Economic Journal - This paper uses a three-tax linear model to study the optimal tax mix numerically. The three aggregate taxes relate to labour, capital and commodities. The most striking...     

Describing and decomposing post-apartheid income inequality in South Africa

This paper describes the changes in inequality in South Africa over the post-apartheid period, using income data from 1993 and 2008. Having shown that the data are comparable over time, it then profiles aggregate changes in income inequality, showing that inequality has increased over the post-apartheid period because an increased share of income has gone to the top decile. Social grants have become much more important as sources of income in the lower deciles. However, income source decomposition shows that the labour market has been and remains the main driver of aggregate inequality. Inequality within each racial group has increased and both standard and new methodologies show that the contribution of between-race inequality has decreased. Both aggregate and within-group inequality are responding to rising unemployment and rising earnings inequality. Those who have neither access to social grants nor the education levels necessary to integrate successfully into a harsh labour market are especially vulnerable.     

The Japanese labour market during the global financial crisis and the role of non-standard work: A micro perspective

This paper analyses aggregate labour dynamics during the global financial crisis in Japan and the role of non-standard work using micro data. The analysis proceeds in two steps. First, using comprehensive establishment-level datasets for the period 1991–2009, it provides a detailed portrait of the adjustment behaviour of establishments at the micro level. Second, it compares aggregate labour market dynamics during the global financial crisis with that observed during the 1997 crisis and decomposes the observed differences into components that can be attributed to changes in the micro-adjustment behaviour of Japanese establishments, changes in the incidence of non-standard work and changes in the distribution of shocks across establishments. It finds that the incidence of non-standard work has increased considerably, worker turnover is much higher among non-standard than standard workers and adjustments in working-time are less important for non-standard workers. Counterfactual simulations suggest that the employment response during the global crisis would have been smaller if the incidence of non-standard work remained at the level observed during the 1997 crisis. The relatively small employment response observed during the global financial crisis is therefore driven by factors other than the increase in the incidence of non-standard work.     

基于因子分析的区域制造业竞争力研究——以山东省为例

文章采用因子分析法对山东省制造业30个行业的竞争力相对全国平均水平进行了综合评价,结论表明目前山东省制造业整体发展水平处于劳动密集型产业向资本密集型产业过渡阶段,具有竞争优势的产业以传统的劳动密集型产业为主,支柱产业以及重点发展产业的产业聚集度还不高,规模经济效应不明显。     

Are House Prices Responsible for Unemployment Persistence?

The paper analyses the ambiguous role of house prices and housing investment for unemployment dynamics. Whereas traditional models see an increase in house prices as a dynamic multiplier that contributes positively to business cycle swings, the paper considers additional transmission mechanisms via the competitiveness channel (wages) and productivity. As house prices rise, wages tend to follow in order to make up for the loss in real disposable income, which limits employment creation. In addition, with rising house prices, the relative size of the construction sector – a low-productivity industry – tends to increase, lowering aggregate productivity growth, further dampening competitiveness. The paper estimates a stylised dynamic general equilibrium model with unemployment flows. Introducing different transmission mechanisms through which the housing market influences labour and macroeconomic dynamics, the size and direction of the housing market channel is being analysed. The estimation results show that housing shocks can have long-lasting negative effects on employment even though a housing boom can generate a short-lived stimulus on growth and employment. The paper also offers some policy advice simulating housing shocks under different types of structural reforms and macro-prudential regulation.     

Lumpy investments, factor adjustments, and labour productivity

This paper describes firms’ output and factor demandsbefore, during, and after episodes of lumpy investment. By usinga rich employer–employee panel data set for two manufacturingindustries and one service industry, we focus on simultaneousvariations in output, capital, materials, man hours, labourproductivity, and the skill composition and hourly cost of labour.Investment spikes are followed by roughly proportional changesin sales, labour, and materials, and significant increases incapital intensity. The changes in labour productivity that areassociated with the investment spikes are small, which indicatesthat productivity improvements are not related to instantaneoustechnological change through investment spikes. Focusing onsectoral differences, capital adjustments are found to be smootherin the service industry than in the two manufacturing industrieswhich may be related to differences in labour intensities betweenthe industries.     

新疆劳动力产业分布结构研究

改革开放以来,新疆劳动力产业分布结构不断变化。利用Moore变动系数来测定了劳动力的产业分布结构,利用历史数据分析劳动力产业分布变动趋势,确定新疆产业结构是＂三、一、二＂格局。新疆的劳动力变动结构并没有加速产业变动结构,新疆产业结构的非正常发展导致了新疆产业劳动力分布结构不合理状态,对新疆经济社会长远发展产生显著影响。     

Do labour market institutions matter? Micro-level wage effects of international outsourcing in three European countries

This paper studies the impact of outsourcing on individual wages in three European countries with markedly different labour market institutions: Germany, the UK and Denmark. To do so we use individual-level data sets for the three countries and construct comparable measures of outsourcing at the industry level, distinguishing outsourcing by broad region. We discuss some possible intuitive reasons for why there may be differences in the impact of outsourcing across the three countries, based on labour market institutions.     

Schistosomiasis and development

This paper evaluates evidence relating to the belief, long held by tropical health workers, that schistosomiasis control would contribute significantly to economic development. The many attempts to estimate the macro benefits of control in terms of the ‘economic loss’ due to the disease are criticized for their emphasis on aggregate output benefits and for the unrealistic assumptions made in estimating the increment in, and marginal product of, efficiency labour units which might result from control. Micro research has so far failed to establish a clear empirical basis for the assumption that schistosomiasis seriously impairs labour productivity — but this may be attributable to sampling bias resulting in the exclusion of workers with severe disease.     

Labour market performance in developing countries: A survey

Malfunctioning of labour markets is often given as a principal explanation of the widespread poverty in developing countries. Open urban unemployment and disguised unemployment in agriculture are generally considered symptoms of the poor performance of the decentralized system of allocation of labour time and skills in these countries.This survey leads us to a much less pessimistic view of labour market performance per se, though obviously imperfections do exist. On the one hand, the shifts of the labour force in response to shifts in demand have been noteworthy and suggest, at an aggregate level, rather impressive performance. On the other, a closer look at open unemployment, disguised unemployment, and other possible types of labour market malfunctions suggests that they may be less serious misallocations than they appear, and that only in part can such misallocations be attributed to poor labour market functioning.Though the labour market is the immediate locus of the problem of low and stagnant incomes of workers at the bottom of the distribution, the evidence suggests no causality in this association. There is no reason to presume that poverty is a manifestation of labour market failure.     

泉州工业结构演变趋势实证分析

泉州的工业结构正处在由轻工业为主转向重工业为主的过程,这是符合工业结构规律的。然相比重工业,泉州的轻工业在规模上仍占有优势。传统轻工业正处在成长的黄金期,新兴重化工业虽然发展迅速,但暂时取代不了传统轻工业的支柱地位。泉州工业化的过程应该是劳动密集——劳动技术密集——劳动知识密集再结合资金密集、技术密集这样的路径实现从轻工业为主向重工业为主转型的过程。     

Structural change in the developed countries during the twentieth century

The central theme of this paper is the process of structuralchange which occurred during the twentieth century in the leadingindustrial nations. The massive scale of the changes in allthese countries is first illustrated by reference to the reallocationof the labour force between agriculture, industry, and the services,and the process of de-industrialization common to all thesecountries is highlighted. Alternative measures based on outputdata at current and constant prices are also considered. Thepaper then explores the main reasons for these shifts in thepattern of activity, looking at the interacting effects of demand-and supply-side factors. This is followed by an examinationof some of the consequences of structural change, includingthe implications for the labour market and the overall growthof labour productivity. The final section speculates brieflyabout the likely implications for the less-developed countriesfollowing behind this advanced group.     

Industrial structure change and economic growth: A China-Russia comparison

This paper examines the sources of economic growth and the nature of industrial structure change in China over the past decade, with a comparison to those in Russia. It shows that over the observation period between 1995 and 2008, the Chinese economy was concentrated relatively more in the manufacturing sector and relatively less in the service sector than the Russian economy. In addition, this paper finds that the higher economic growth rate in real GDP and aggregate labour productivity growth between 1996 and 2008 in China than in Russia was broadly based, with most industries contributing to China's better performance. Furthermore, it reveals that the acceleration in economic growth in China in 2003–2008 over 1996–2002 was mainly traced to an increased contribution from the manufacturing sector and to a lesser degree the service sector, while in Russia, it was the service sector, followed by the primary sector driven by the mining and oil and gas extraction industry. These results suggest that the Chinese and Russian economies complement each other, which bodes well for further economic cooperation and trade between the two countries.     

Eastern European trade and the Austrian labour market

Eastern European Trade and the Austrian Labour Market. — Recent years have seen a major break in trade relations between Western and Eastern European countries. Austria experienced a large bilateral trade creation with these countries. In this paper, the authors take a closer look at the impact this trade growth had on the Austrian labour market. To differentiate as far as possible between different segments of the labour market, they concentrate on unemployment experience and wage growth for a panel of individual workers in Austrian industry. The results show rather small employment effects, the impact on wage growth is more pronounced with interesting modifications for mobile and immobile workers.