Sectoral Shifts, Costly Mobility And Aggregate Unemployment: Evidence From Seven Industrialized Countries

Determining what percentage of a country's unemployment rate is "natural", as opposed to cyclical, has been a preoccupation of macroeconomists for a very long time and is still a subject of debate today. This thesis studies this issue in the light of a more recent and comprehensive approach. A theoretical model is presented in the second chapter that puts the emphasis on the presence of transaction costs in the labour and the goods markets, and of technological shocks hitting firms differently depending on the good they produce. Given the assumption of costly mobility of labour across sectors of production, it is demonstrated that these sector-specific shocks result in equilibrium in a positive and fluctuating natural rate of unemployment. The existence of a one-period nominal wage contract signed before the money supply is known, also ensures that deviations from this natural rate are caused by unanticipated monetary policy (only).;These two predictions, that of the neutrality of anticipated monetary policy and that of a fluctuating natural rate responsible for a fairly good part of the movements in the actual rate, are tested in the third and fourth chapters. Chapter three provides evidence in favour of these propositions for Canada and the United States, and also identifies "real" factors as a major source of transmission of the business cycle between the two countries. Chapter four also accepts the two propositions described above using data from France, Germany, Japan and the United Kingdom. Italy is the only country for which the second proposition is rejected.

Name thesis:degree_name

Ph D

Year dc:date.issued

1987

Author dc:creator

• Samson, Lucie

• Economics
• General

Handle dc:identifier.uri

https://hdl.handle.net/20.500.14721/21175

OAI identifier oai:identifier

oai:uwo.scholaris.ca:20.500.14721/21175