Revisiting Okun's Relationship

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Revisiting Okun's Relationship Prof. Dr. Ir. J. C. (Jan) van Ours Tilburg University, Netherlands This talk will revisit Okun's relationship between observed unemployment rates and output gaps. We include in the relationship the effect of labour market institutions as well as age and gender effects. Our empirical analysis is based on 20 OECD countries over the period 1985-2013. We find that the share of temporary workers (which includes a high and rising share of young workers) played a crucial role in explaining changes in the Okun coefficient (the impact of the output gap on the unemployment rate) over time. The Okun coefficient is not only different for young, prime-age and older workers, it decreases with age. From a policy perspective, it follows that an increase in economic growth will not only have the desired outcome of reducing the overall unemployment rate, it will also have the distributional effect of lowering youth unemployment. Wednesday, April 27, 2016, 5.15 pm – 6:30 pm Campus Westend, RuW, 4.201 Jan van Ours is professor in Labour Economics at the Department of Economics, Tilburg University. He is also professorial fellow at the Department of Economics, University of Melbourne, CentER Fellow and CEPR Fellow. Jan van Ours studied mining engineering at the Technical University in Delft and economics at Erasmus University Rotterdam, where he also got his Ph.D. He has published in journals like American Economic Review, Journal of Political Economy, Journal of Labor Economics, Economic Journal, European Economic Review, Journal of Economic History, Journal of Public Economics, Journal of Health Economics, and Oxford Economic Papers. Currently he is managing editor of De Economist. This lecture is part of the Applied Microeconomics and Organization Seminar of the Department of Management and Micro-Economics and of the Wednesday Lecture Series within the IZO’s research project “Protecting the Weak. Entangled Processes of Framing, Institutionalization and Mobilization in East Asia” funded by the Volkswagen Foundation. Contact person: Prof. Cornelia Storz, Faculty 02, Chair for the Study of Economic Institutions, Innovation and East Asian Development, Email: [email protected] For further information: www.protectingtheweak.uni-frankfurt.de .

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The Minimum Wage in the Netherlands
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