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1. Hard Times, Hard Attitudes? The Effect of Economic Downturns on Gender Norms

Author:
Inés Berniell, Leonardo Gasparini, Mariana Marchionni, and Mariana Viollaz
Publication Date:
02-2025
Content Type:
Working Paper
Institution:
Center for Distributive, Labor and Social Studies (CEDLAS)
Abstract:
This paper examines the impact of economic fluctuations on social norms, specifically exploring the link between changes in unemployment and shifts in attitudes toward gender roles in the labor market. The results are not immediately obvious, as the literature suggests several potential mechanisms with conflicting outcomes. Using microdata from the World Values Survey for a panel of 103 countries that cover close to 90% of the world population, we estimate individual-level probability models of agreement with traditional gender roles over the period 1995 to 2021, including country and year fixed effects. We find that an increase in unemployment is associated to more conservative views about gender roles in the labor market. This result is remarkably robust across different groups and specifications. We also find that some contextual factors matter. In particular, the link between higher unemployment and more conservative views on gender roles is stronger in countries with, on average, higher gender inequality and lower female labor force participation. Overall, this study contributes to a growing body of research on the complex relationship between economic conditions, gender norms, and social change.
Topic:
Economics, Unemployment, Attitudes, Gender, and Social Norms
Political Geography:
Global Focus

2. Labour Market Flows and Gender Differentials in Urban Unemployment Over the Pandemic

Author:
Paaritosh Nath
Publication Date:
05-2023
Content Type:
Working Paper
Institution:
Centre for Sustainable Employment, Azim Premji University
Abstract:
Utilising data from the Periodic Labour Force Survey, we estimate quarterly changes in urban labour market flows over the period 2018 to 2022 and the impact on unemployment rates for men and women. Our analysis provides non-intuitive explanations for established findings as well as pointing out important questions for further study. Both men and women’s unemployment rates have reduced in 2022 compared to 2018, showing rapid reductions following the high levels reached during the lockdown. Women’s unemployment rates have consistently been higher than men throughout this period. The gap between men and women’s unemployment rates reduced during the lockdown, but have shown signs of increasing since 2021, even as unemployment rates have fallen. For women, flows from the labour force to non-participation play a larger role in explaining changes in unemployment rates as compared to men. Flows from the labour force to non-participation, however, have reduced since the pandemic, providing an explanation as to why labour force participation rates have increased, namely, women staying for longer in the labour force rather than more women entering it. Despite rising labour force participation rates, the gender gap in unemployment rates have risen, in contrast to developed economies.
Topic:
Urban, Unemployment, COVID-19, Labor Market, and Gender
Political Geography:
South Asia, India, and Global Focus

3. 25 years of excess unemployment in advanced economies: Lessons for monetary policy

Author:
Joseph E. Gagnon and Madi Sarsenbayev
Publication Date:
10-2022
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics (PIIE)
Abstract:
For about 25 years before the COVID-19 pandemic, inflation was very low and stable in most advanced economies. A little noticed dark side of this impressive achievement is that unemployment rates were almost always higher than needed to keep inflation low. This widespread and persistent policy error arose because of a major flaw in standard macroeconomic models—the use of a linear Phillips curve. This flaw would have been far less costly if central banks had not chosen such a low target for inflation. This paper thus adds to the arguments in favor of a moderately higher inflation target. Even without a higher target, central banks need to use a broader range of economic models and should verify their estimates of the natural rate of unemployment by running the economy hot from time to time in order to see nascent inflationary pressure before throttling back.
Topic:
Economics, Monetary Policy, Unemployment, and COVID-19
Political Geography:
Global Focus

4. On the Non-Inflationary effects of Long-Term Unemployment Reductions

Author:
Walter Paternesi Meloni, Davide Romaniello, and Antonella Stirati
Publication Date:
04-2021
Content Type:
Working Paper
Institution:
Institute for New Economic Thinking (INET)
Abstract:
The paper critically examines the New Keynesian explanation of hysteresis based on the role of long-term unemployment. We first examine its analytical foundations, according to which rehiring long-term unemployed individuals would not be possible without accelerating inflation. Then we empirically assess its validity along two lines of inquiry. First, we investigate the reversibility of long-term unemployment. Then we focus on episodes of sustained long-term unemployment reductions to check for inflationary effects. Specifically, in a panel of 25 OECD countries (from 1983 to 2016), we verify by means of local projections whether they are associated with inflationary pressures in a subsequent five-year window. Two main results emerge: i) the evolution of the long-term unemployment rate is almost completely synchronous with the dynamics of the total unemployment rate, both during downswings and upswings; ii) we do not find indications of accelerating or persistently higher inflation during and after episodes of strong declines in the longterm unemployment rate, even when they occur in country-years in which the actual unemployment rate was estimated to be below a conventionally estimated Non-Accelerating Inflation Rate of Unemployment (NAIRU). Our results call into question the role of long-term unemployment in causing hysteresis and provide support to policy implications that are at variance with the conventional wisdom that regards the NAIRU as an inflationary barrier.
Topic:
Inflation, Macroeconomics, Unemployment, and Labor Market
Political Geography:
Global Focus

5. The Updated Okun Method for Estimation of Potential Output with Broad Measures of Labor Underutilization: An Empirical Analysis

Author:
Claudia Fontanari, Antonella Palumbo, and Chiara Salvatori
Publication Date:
05-2021
Content Type:
Working Paper
Institution:
Institute for New Economic Thinking (INET)
Abstract:
This paper extends to different indicators of labor underutilization the Updated Okun Method (UOM) for estimation of potential output proposed in Fontanari et al (2020), which, from a demand-led growth perspective, regards potential output as an empirical approximation to fullemployment output, as in A.M.Okun’s (1962) original method. Based on the apparent incapability of the official rate of unemployment to fully account for labor underutilization, in this paper we offer estimates of Okun’s law both with broad unemployment indicators and with an indicator of ‘standardized hours worked’ which we propose as a novel measure of the labor input. The paper reflects on the possible different empirical measures of full employment. The various measures of potential output that we extract from our analysis show greater output gaps than those produced by standard methods, thus highlighting a systematic tendency of the latter to underestimate potential output. Output gaps that underestimate the size of the output loss or that tend to close too soon during recovery, may produce a bias towards untimely restriction.
Topic:
Economics, Labor Issues, Economic Growth, Demand, and Unemployment
Political Geography:
Global Focus

6. The Flimsy Foundations of Neoliberal Macroeconomics: David Gordon on Saving, Investment, and the Natural Rate of Unemployment

Author:
Robert Pollin
Publication Date:
06-2021
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
David Gordon was, at once, a highly creative economist with an enormous range of interests, while also uncompromising in maintaining rigorous research standards. He was focused equally on hard-core academic research and pressing policy issues. He was also openly committed to the political left, with this commitment animating all his work. One distinctive feature of Gordon’s work was his keenness to dive into the most important topics engaging mainstream economists and to inject explicitly left political economy perspectives into these mainstream debates. This paper focuses on two important examples of Gordon’s contributions that examine front-and-center mainstream macroeconomics questions. The first is the relationship between aggregate saving and investment. The second is the development of the concept of the ‘natural rate of unemployment.’ The evolution of mainstream research on these two questions played a critical role in overturning what had been, over the first two post-World War II decades, a prevailing Keynesian/social democratic consensus, at both the levels of analytic economics as well as economic policy. As the paper reviews, Gordon challenges the analytic findings and policy implications of these perspectives at their core. Gordon’s own basic premises and results are straightforward. He argues that, in fact, investment decisions, not saving rates, are the main driver of economic activity in capitalist economies and that operating capitalist economies at something akin to genuine full employment—i.e. in the range of 2 – 3 percent official unemployment—is a realistic goal. As such, these papers by Gordon contribute significantly toward envisioning a post-neoliberal social structure of accumulation that is committed to the egalitarian principles that were central to Gordon’s life work.
Topic:
Political Economy, Neoliberalism, Investment, Macroeconomics, Unemployment, Saving, and David Gordon
Political Geography:
Global Focus

7. Endogenous Growth, Skill Obsolescence and Optimal Monetary Policy

Author:
Wolfgang Lechthaler and Mewael F. Tesfaselassie
Publication Date:
11-2021
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
We analyze Ramsey optimal monetary policy in a New-Keynesian model with search and matching frictions featuring (i) training costs due to skill loss from long-term unemployment and (ii) endogenous growth through learning-by-doing externalities. In a simplified two-period version of the model, the competitive equilibrium is shown to be inefficient due to two externalities: i) firms do not internalize the effects that hiring has on labor productivity through learning-by-doing; ii) firms do not fully internalize the effects that hiring has on future training costs. These externalities lead to inefficient fluctuations, thereby justifying deviations from price stability in response to productivity shocks. In a calibrated version of the full model we show significant deviations from price stability and significant differences between optimal monetary policy and monetary policy that follows a Taylor rule.
Topic:
Economic Growth, Economic Theory, Keynes, and Unemployment
Political Geography:
Global Focus

8. Labor force participation, job search effort and unemployment insurance in the laboratory

Author:
Wolfgang Lechthaler and Patrick Ring
Publication Date:
03-2020
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
How the provision of unemployment benefits affects employment and unemployment is a debated issue. In this paper, we aim at complementing theoretical and empirical contributions to this debate with a laboratory experiment: We simulate a job market with search effort and labor force participation decisions while varying the maximum length of unemployment benefit eligibility. Our results reveal two separable, opposing effects: Individuals within the labor force search with lower effort when unemployment benefits are extended. However, individuals are more likely to participate in the labor force and to actively search for a job. Concerning employment, the second effect dominates so that unemployment benefits raise employment.
Topic:
Economics, International Political Economy, Markets, Labor Issues, Employment, Unemployment, and Job Creation
Political Geography:
Global Focus

9. Does Employment Protection Affect Unemployment? A Meta-analysis

Author:
Philipp Heimberger
Publication Date:
02-2020
Content Type:
Working Paper
Institution:
The Vienna Institute for International Economic Studies (WIIW)
Abstract:
Despite extensive research efforts, the magnitude of the effect of employment protection legislation (EPL) on unemployment remains unclear. Existing econometric estimates exhibit substantial variation, and it is therefore difficult to draw valid conclusions. This paper applies meta-analysis and meta-regression methods to a unique data set consisting of 881 observations on the effect of EPL on unemployment from 75 studies. Once we control for publication selection bias, we cannot reject the hypothesis that the average effect of EPL on unemployment is zero. The meta-regression analysis, which investigates sources of heterogeneity in the reported effect sizes, reveals the following main results. First, the choice of the EPL variable matters: estimates that build on survey-based EPL variables report a significantly stronger unemployment-increasing impact of EPL than estimates developed using EPL indices based on the OECD’s methodology, where the latter relies on coding information from legal provisions. Second, we find that employment protection has a small unemployment-increasing effect on female unemployment, compared with a zero impact on total unemployment. Third, using multi-year averages of the underlying data tends to dampen the unemployment effects of EPL. Fourth, product market regulation is found to moderate the effect of EPL on unemployment.
Topic:
Labor Issues, European Union, Employment, Unemployment, and Organisation for Economic Co-operation and Development
Political Geography:
Europe and Global Focus

10. Boyut ve Etkenleriyle Sosyal Dışlanmanın Yoksullukla Karşılaştırmalı İlişkisi

Author:
Mustafa Hatipler
Publication Date:
04-2019
Content Type:
Journal Article
Journal:
Bilgi
Institution:
Sakarya University (SAU)
Abstract:
Sosyal dışlanma kavramı 1980’li yıllarda gelişmiş ülkelerde kullanılmaya başlanmıştır. İçtimai, siyasi, kültürel ve iktisadi olumsuzlukların toplanması sonucunda sosyal dışlanma ortaya çıkmaktadır. Sosyal dışlanma; toplumun bir kesiminin işsizlik, yoksulluk, eğitimsizlik, yaşlılık, engellilik gibi nedenlerden dolayı sağlık, eğitim ve kültürel imkânlarından yararlanamamaları, üretim faaliyetlerinde bulunamamaları ve karar alma etkinliklerine katılamamaları olarak ifade edilebilir. Sosyal dışlanma ve yoksulluk kavramının birbirinden farklı olup olmadığı hususunda görüş birliği yoktur. Bir görüşe göre sosyal dışlanma yoksulluğu barından çok geniş bir kavramken, diğer görüşlere göre yoksulluğun nedenini veya sonucunu oluşturmaktadır. Tüm bunların sonucunda sosyal dışlanma toplumsal alanda barış için de bir tehdit unsuru olmakla birlikte sosyal bölünme ve sosyal patlama gibi olumsuzluklara da sebep olmaktadır. Sosyal dışlanma ile mücadelede sosyal politikalar önem kazanmaktadır. Bu çalışmanın amacı, sosyal dışlanma ve yoksulluk kavramlarını karşılaştırmalı olarak incelemektir.
Topic:
Poverty, Unemployment, and Social Exclusion
Political Geography:
Turkey and Global Focus