The Beveridge Curve, Unemployment, and Wages in the OECD from the 1960s to the 1990s

By Stephen Nickell, Luca Nunziata, W. Ochel, G. Quintini. 2001

410 citations recorded by the source corpus.

This paper is an empirical analysis of unemployment patterns in the OECD countries from the 1960s to the 1990s, looking at the Beveridge Curves, real wages as well as unemployment directly. Our results indicate the following. First, the Beveridge Curves of all the countries except Norway and Sweden shifted to the right from the 1960s to the early/mid 1980s. At this point, the countries divide into two distinct groups. Those whose Beveridge Curves continued to shift out and those where they started to shift back. Second, we find evidence that these movements in the Beveridge Curves may be partly explained by changes in labour market institutions, particularly those which are important for search and matching efficiency. Third, labour market institutions impact on real labour costs in a fashion which is broadly consistent with their impact on unemployment. Finally, broad movements in unemployment across the OECD can be explained by shifts in labour market institutions although this explanation relies on high levels of endogenous persistence as reflected in a lagged dependent variable coefficient of around 0.9.

Subfields: Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/608473ec085eea6987b072fa9bf7b6f9767ff509

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Citations in the corpus

The Effect of Consumption and Production Structure on Growth and Distribution: A Micro to Macro Model (2010, neutral): “Both parameters are set taking account of the mixed empirical evidence from the few available estimates (Wall and Zoega, 2002; Nickell et al., 2002; Teo et al., 2004).”
Employment and Taxes (2003, positive): “Nickell et al (2003) report an equivalent figure of 3.7 per cent controlling for a complete set of labour market institutions (see Table 12. col.1).”
European unemployment: the evolution of facts and ideas (2006, positive): “…initially hoped that the joint use of these two tools would prove powerful (Blanchard and Diamond, 1989; Blanchard, 1990); I have been disappointed, at least in its application to unemployment in Europe (for a recent examination, and a slightly more optimistic conclusion, see Nickell et al., 2002).”
Did the pattern of aggregate employment growth change in the euro area in the late 1990s? (2006, positive): “This latter methodological approach can be associated with the branch of the literature initiated by Scarpetta (1996) and extended by Belot and van Ours (2000) and Nickell et al. (2001).”
Civic Virtue and Labor Market Institutions (2009, methodology): “The benefit duration index (BD) is provided by the indicator of Stephen Nickell et al. (2001), which accounts for decreasing replacement rate by duration.”
Employment Regulations Through the Eyes of Employers: Do They Matter and How Do Firms Respond to Them? (2004, positive): “However, Nickell et al. (2001, 2003) find that unemployment in OECD countries are mainly due to changes in labor market policy and institutions with no effect stemming from interactions between institutions and shocks.”
Are Protective Labor Market Institutions at the Root of Unemployment? A Critical Review of the Evidence (2007, positive): “We replaced six of the eight institutional variables used in the 1997 tests with improved measures that were employed by the same author in more recent work (Nickell et al., 2003; 2005).”
Privatization and the Decline of Labour's Share: International Evidence from Network Industries (2012, positive): “…(5.287) Employment Protection -6.491 -2.277 -5.548 0.609 (1.249) (3.316) (1.428) (4.069) Fixed Effects (50) No Yes No Yes Observations 789 789 789 789 NOTES: - Coefficients and standard errors are multiplied by 100; Employment Protection measures are drawn from the OECD (Nickell et al (2002)).”
The Roots of Low European Employment: Family Culture? (2005, positive): “To identify the speci…c role of household durable good price on the employment rate of young and older people, we also include the same time-varying labor market institutions (Nickell et al, 2001) as the previous estimations.”
Institutions and Wage Determination: a Multi-Country Approach (2005, neutral): “000 Fisher panel statistic of Phillips Perron test χ(2)(40) = 99.”
Civil Society And The State: The Interplay Between Cooperation And Minimum Wage Regulation (2011, background): “The second column shows that the correlation between the quality of labor relation and union density remains statistically signi cant at the ve percent level when one controls for the unemployment rate and traditional labor market institutions taken from Nickell et al. (2001).”