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Can Insider–Outsider Theories Explain the Persistence of Unemployment? An Econometric Study of Two British Industries
Author(s) -
Mulvey Gail C.
Publication year - 1997
Publication title -
the manchester school
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.361
H-Index - 42
eISSN - 1467-9957
pISSN - 1463-6786
DOI - 10.1111/1467-9957.00049
Subject(s) - insider , unemployment , economics , hysteresis , persistence (discontinuity) , wage , labour economics , macroeconomics , economy , engineering , law , physics , geotechnical engineering , quantum mechanics , political science
Using industry‐specific and aggregate data for the period 1952–85, this paper focuses on the potential of the insider–outsider explanation of unemployment to account for the differing economic performance of two British industries, electrical engineering and motor vehicles. The former industry experienced a steady expansion in this period whilst the latter was in relative decline. Although hysteresis was found to be somewhat greater in the motor vehicle industry, insider power was rejected, both as a cause of the persistence of unemployment and as an explanation of that industry's contraction.