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Okun's Law :, Fit at 50?, Laurence Ball, Daniel Leigh, Prakash Loungani

This paper asks how well Okun’s Law fits short-run unemployment movements in the United States since 1948 and in twenty advanced economies since 1980. We find that Okun’s Law isa strong and stable relationship in most countries, one that did not change substantiallyduring the Great Recession. Accounts of breakdowns in the Law, such as the emergence of“jobless recoveries,” are flawed. We also find that the coefficient in the relationship—the effect of a one percent change in output on the unemployment rate—varies substantially across countries. This variation is partly explained by idiosyncratic features of national labormarkets, but it is not related to differences in employment protection legislation
Table Of Contents
Cover; Okun's Law: Fit at 50?; Abstract; INTRODUCTION; II. ESTIMATING OKUN'S LAW; A. Okun's Law; B. Estimation; III. OKUN'S LAW IN THE UNITED STATES; A. Annual Data: Main Results; B. Annual Data: Robustness; Addressing the Endpoint Problem; Forecast Errors; CBO Estimates; C. Quarterly Data; D. Comparison to Okun (1962); E. Output, Employment, and Unemployment; IV. JOBLESS RECOVERIES?; V. OKUN'S LAW IN 20 ADVANCED ECONOMIES; A. Basic Results; B. Stability Over Time; VI. OKUN'S LAW IN THE GREAT RECESSION; A. Output and Unemployment from Peak to Trough; B. Correcting for the Length of Recessions
Literary Form
non fiction
Description based upon print version of record
Physical Description
1 online resource (41 p.)
Specific Material Designation
Form Of Item

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