Testing the hypotheses of hysteresis and naturel rate of unemployment for youth and female unemployment: evidence from Fourier panel unit root tests for European Union countries

Year 2020, Volume: 11 Issue: Ek, 56 - 73, 31.12.2020

Murat Belke

Abstract

Testing the validity of hypotheses of the natural rate of unemployment and hysteresis in unemployment rates is important in determining the employment policies to be applied. Generally, unit root tests are used to determine the existence of these hypotheses. The hysteresis hypothesis is represented by the unit root process. If the unit root is rejected, it is concluded that the unemployment series is stationary and the natural rate of unemployment hypothesis is valid. The aim of this study is to test the validity of the natural rate of unemployment or hysteresis hypotheses in the total unemployment, female unemployment, youth unemployment, and young female unemployment rates in 28 European Union countries. For this reason, Fourier panel KSS unit root tests were applied to the unemployment series of total, young, female, and young female in the period 2003Q2-2019Q1. According to the findings, in with fixed and with trend model, total unemployment rate series in all countries except Hungary and Portugal have mean reverting process. In this case, while the hysteresis hypothesis in total unemployment rate is valid for the two countries mentioned, the natural rate of unemployment hypothesis is valid in other countries. Also, the findings show that the hypothesis of natural rate of unemployment is valid for female unemployment in 22 other countries except the UK, Spain, Hungary, Germany, Slovenia and Portugal. Besides, it shows that the hypothesis of natural rate of unemployment is valid in all countries for youth unemployment and in 27 other countries except England for youth female unemployment.

Keywords

Natural Rate of Unemployment, Unemployment Hysteresis, Youth and Female Unemployment, Fourier Panel Data Unit Root Test

Genç ve Kadın İşsizliğinde Histeri ve Doğal Oran Hipotezlerinin Test Edilmesi: Avrupa Birliği Ülkeleri İçin Fourier Panel Birim Kök Testlerinden Kanıtlar

Abstract

İşsizlik oranlarında doğal oran veya histeri hipotezlerinin geçerliliğinin test edilmesi uygulanacak istihdam politikalarının belirlenmesi açısından önemlidir. Söz konusu hipotezlerinin varlığının belirlenmesi için genellikle birim kök testleri kullanılmaktadır. Histeri hipotezi birim kök süreci ile temsil edilirken, birim kökün reddedilmesi halinde işsizlik serisinin durağan olduğu ve doğal oran hipotezinin geçerli olduğu sonucuna ulaşılmaktadır. Bu çalışmanın amacı, 28 Avrupa Birliği ülkesinde toplam işsizlik, kadın işsizliği, genç işsizliği, ve genç kadın işsizliği oranlarında doğal oran veya histeri hipotezinin geçerliliğini test etmektir. Bu nedenle, 2003Q2-2019Q1 dönemi toplam, genç, kadın ve genç kadın işsizlik serilerine Fourier panel KSS birim kök testleri uygulanmıştır. Bulgulara göre, sabit ve trende sahip modelde toplam işsizlikte Macaristan ve Portekiz hariç tüm ülkelerde işsizlik serileri ortalamaya dönme eğilimindedir. Bu durumda bahsedilen iki ülke için toplam işsizlikte histeri hipotezi geçerli iken, diğer ülkelerde doğal oran hipotezinin geçerli olduğunu söylemek mümkündür. Kadın, genç ve genç kadın işsizlik serilerine uygulanan panel birim kök testinden elde edilen bulgular, kadın işsizliğinde İngiltere, İspanya, Macaristan, Almanya, Slovenya ve Portekiz hariç diğer 22 ülkede; genç işsizliğinde tüm ülkelerde ve genç kadın işsizliğinde ise İngiltere hariç diğer 27 ülkede serilerin doğal oran hipotezinin geçerli olduğunu göstermektedir.

Keywords

Doğal işsizlik oranı, İşsizlik histerisi, genç ve kadın işsizliği, Fourier Panel Birim Kök Testi

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