Unveiling Spanish unemployment persistence by output gap: a time-varying parameter approach

Date

2018-11-03

Author

Aydın, Dilan
Yıldırım Kasap, Dilem

Metadata

Show full item record

Item Usage Stats

99
views

0
downloads

This paper investigates the persistence of Spanish unemployment by incorporating the output gap over the period of 1972-2015. Unlike to the existing literature which identifies labor market rigidity as the triggering factor of high unemployment, we utilize output gap extracted by Kalman filter in order to discriminate between impacts originated from (demand side) shocks and labor market institutions. Time-varying parameter approach allowing for both abrupt and smooth structural changes of parameters facilitates to explore the evolution of the persistence in the country whose history is full of crises and labor market reforms. The presence of lags between the implementation of the policy and its influence on the economy and the interactions between the shocks induce direction towards the gradual changes in Spain. Moreover, the model enables to scrutinize the natural rate or hysteresis hypothesis for each period without restricting the analysis into a dichotomous framework. Estimation results providing evidence in favor of hysteretic effects during the late 1970s and the early 1980s reveal a declining (rising) coefficient for lagged unemployment (output gap) in the subsequent years. Whereas abrupt changes of coefficients after 1984 and 1994 reforms coincided with the start of recovery phases, smooth transition of persistence coefficient after 2008 underlies different dynamics.

URI

http://www.tek.org.tr/dosyalar/UEK-TEK_2018.pdf
https://hdl.handle.net/11511/80946

Collections

Unverified, Conference / Seminar

Suggestions

OpenMETU
Core

Unveiling Spanish unemployment persistence by output gap: a time-varying parameter approach Aydın, Dilan; Yıldırım Kasap, Dilem; Department of Economics (2018) This paper investigates the persistence of Spanish unemployment by incorporating the output gap over the period of 1972-2015. Unlike to the existing literature which identiﬁes labor market rigidity as the triggering factor of high unemployment, we utilize output gap extracted by Kalman ﬁlter in order to discriminate between impacts originated from (demand side) shocks and labor market institutions. Time-varying parameter approach allowing for both abrupt and smooth structural changes of parameters facilitat...
The Relationship between unemployment rate and growth: time series approach for Turkey Akpiliç, Ferdi; Yozgatlıgil, Ceylan; Department of Statistics (2016) This study analyzes the relationship of economic growth and unemployment by using quarterly data for the period 2005:Q1-2016:Q1 for Turkish Economy. Three different versions of Okun’s law which are difference, gap and dynamic versions are investigated in the study. According to results, it is found that Okun’s Law is valid for Turkey. In addition, productivity variable is added to dynamic models to test effect of productivity on unemployment rate and models results reveal positive relationship between produ...
The Assessment of macroeconomic variability and monetary transmission mechanisms in Turkey with VAR esrimates Baştan, Emine Meltem; Gaygısız Lajunen, Esma; Department of Economics (2012) This thesis investigates the nature of macroeconomic changes by focussing on the monetary policy changes in Turkey between 1990Q1-2011Q4 and assesses the variability of the economy via impulse response functions obtained from VAR analyses. The period of the analyses is characterized with changes of the definitions of monetary aggregates in 2002 and 2007. In order to have consistent monetary series, the new and old series are constructed according to new and old definitions and then analyses are carried out ...
The Unemployment problem and employment creation strategies in Turkey: a comparative perspective Gökşen Uğurer, Seçil; Şenses, Fikret; Department of Economics (2012) This thesis analyzes the Turkish unemployment problem in the 2000-2011 period, in a broad and comparative perspective with unemployment problem in the Netherlands, Ireland and Argentina. However, periods of concern for these three countries and Turkey differ, because each country experienced severe unemployment problem in different time periods. The main objective of this thesis is to evaluate current policies dealing with unemployment problem in Turkey and suggest more effective policy alternatives, with r...
The Privatisation Experience In Turkey And Argentina: A Comparative Study, 1986-2007 Karataş, Cevat; Ercan, Metin (Orta Doğu Teknik Üniversitesi (Ankara, Turkey), 2008-12) This paper examines and compares in details the privatiation experiences in Turkey and Argentina during the 1986-2007 period. The sales methods used in both countries are discussed and public offer and block sales are appraised to reflect their impacts on the welfare of the society. The privatisation practice of Argentina is discussed in terms of its scope,sales method and post-privatisation results and in particular key issues such as monopolisation and consumers’ protection are accentuated.The effectivene...

Citation Formats

D. Aydın and D. Yıldırım Kasap, “Unveiling Spanish unemployment persistence by output gap: a time-varying parameter approach,” 2018, Accessed: 00, 2021. [Online]. Available: http://www.tek.org.tr/dosyalar/UEK-TEK_2018.pdf.