The Unemployment Invariant Hypothesis: Heterogeneous Panel Cointegration Evidence from U.S. State Level Data
We explore the long-run relationship between the unemployment rate and the labor force participation rates for United States over the period of 1976 to 2015. We use U.S. state level data and panel cointegration techniques that are robust to cross sectional heterogeneity, cross-sectional dependency,...
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| Format: | Article |
| Language: | English |
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EconJournals
2017-01-01
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| Series: | International Journal of Economics and Financial Issues |
| Online Access: | http://mail.econjournals.com/index.php/ijefi/article/view/3239 |
| _version_ | 1797908488038383616 |
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| author | Mercy Laita Palamuleni |
| author_facet | Mercy Laita Palamuleni |
| author_sort | Mercy Laita Palamuleni |
| collection | DOAJ |
| description |
We explore the long-run relationship between the unemployment rate and the labor force participation rates for United States over the period of 1976 to 2015. We use U.S. state level data and panel cointegration techniques that are robust to cross sectional heterogeneity, cross-sectional dependency, omitted variable bias and endogeniety issues. We find evidence that on average these two variables are cointegrated and are inversely related. Similar to studies that employ U.S. country level data, this study further questions the empirical relevance of the unemployment invariant hypothesis for the case of the United States.
Keywords: Unemployment rate; Unemployment invariant hypothesis; panel cointegration
JEL Classifications: E24, J60
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| first_indexed | 2024-04-10T10:53:29Z |
| format | Article |
| id | doaj.art-b148ad5288b94a4481eaf49ca01f3551 |
| institution | Directory Open Access Journal |
| issn | 2146-4138 |
| language | English |
| last_indexed | 2024-04-10T10:53:29Z |
| publishDate | 2017-01-01 |
| publisher | EconJournals |
| record_format | Article |
| series | International Journal of Economics and Financial Issues |
| spelling | doaj.art-b148ad5288b94a4481eaf49ca01f35512023-02-15T16:20:04ZengEconJournalsInternational Journal of Economics and Financial Issues2146-41382017-01-0171The Unemployment Invariant Hypothesis: Heterogeneous Panel Cointegration Evidence from U.S. State Level DataMercy Laita Palamuleni0McNeese State University We explore the long-run relationship between the unemployment rate and the labor force participation rates for United States over the period of 1976 to 2015. We use U.S. state level data and panel cointegration techniques that are robust to cross sectional heterogeneity, cross-sectional dependency, omitted variable bias and endogeniety issues. We find evidence that on average these two variables are cointegrated and are inversely related. Similar to studies that employ U.S. country level data, this study further questions the empirical relevance of the unemployment invariant hypothesis for the case of the United States. Keywords: Unemployment rate; Unemployment invariant hypothesis; panel cointegration JEL Classifications: E24, J60 http://mail.econjournals.com/index.php/ijefi/article/view/3239 |
| spellingShingle | Mercy Laita Palamuleni The Unemployment Invariant Hypothesis: Heterogeneous Panel Cointegration Evidence from U.S. State Level Data International Journal of Economics and Financial Issues |
| title | The Unemployment Invariant Hypothesis: Heterogeneous Panel Cointegration Evidence from U.S. State Level Data |
| title_full | The Unemployment Invariant Hypothesis: Heterogeneous Panel Cointegration Evidence from U.S. State Level Data |
| title_fullStr | The Unemployment Invariant Hypothesis: Heterogeneous Panel Cointegration Evidence from U.S. State Level Data |
| title_full_unstemmed | The Unemployment Invariant Hypothesis: Heterogeneous Panel Cointegration Evidence from U.S. State Level Data |
| title_short | The Unemployment Invariant Hypothesis: Heterogeneous Panel Cointegration Evidence from U.S. State Level Data |
| title_sort | unemployment invariant hypothesis heterogeneous panel cointegration evidence from u s state level data |
| url | http://mail.econjournals.com/index.php/ijefi/article/view/3239 |
| work_keys_str_mv | AT mercylaitapalamuleni theunemploymentinvarianthypothesisheterogeneouspanelcointegrationevidencefromusstateleveldata AT mercylaitapalamuleni unemploymentinvarianthypothesisheterogeneouspanelcointegrationevidencefromusstateleveldata |