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Unemployment Hysteresis in the US States and the EU: A Panel Approach
Author(s) -
León–Ledesma Miguel A.
Publication year - 2002
Publication title -
bulletin of economic research
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.227
H-Index - 29
eISSN - 1467-8586
pISSN - 0307-3378
DOI - 10.1111/1467-8586.00141
Subject(s) - economics , hysteresis , unemployment , natural rate of unemployment , unit root , structural break , eu countries , unemployment rate , econometrics , unit root test , panel data , macroeconomics , cointegration , international economics , european union , physics , quantum mechanics
This paper applies the panel unit root test proposed by Im, Pesaran and Shin (1997) to test for unemployment hysteresis in the US states and the EU countries against the alternative of a natural rate. The results show that hysteresis for the EU and the natural rate for the US states are the most plausible hypotheses.