Working Paper Series, Uppsala Center for Labor Studies, Department of Economics, Uppsala University
Labor-Force Participation Rates and the Informational Value of Unemployment Rates: Evidence from Disaggregated US Data
() and Pär Österholm
Abstract: The informational value of the aggregate US unemployment
rate has recently been questioned because of a unit root in the labor-force
participation rate; the lack of mean reversion implies that long-run
changes in unemployment rates are highly unlikely to reflect long-run
changes in joblessness. This paper shows that this critique also extends to
unemployment rates for sub-populations, such as prime-aged males.
Keywords: Mean reversion; Unit-root test; (follow links to similar papers)
JEL-Codes: C22; E24; J21; (follow links to similar papers)
13 pages, December 2, 2010
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