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The Discouraged Worker Effect and the Added Worker Effect within the Framework of European Debt Crisis

Year 2019, Volume: 18 Issue: 1, 522 - 534, 22.01.2019
https://doi.org/10.21547/jss.425024

Abstract

The debt crisis experienced in Europe has had
several adverse effects on economies of countries. Employment is one of the
adversely affected areas. The relationship between the labor force
participation rate and unemployment is essentially examined within the
framework of two hypotheses. These hypotheses are “The Discouraged Worker
Effect” and “The Added Worker Effect”. The discouraged worker effect
anticipates that workers looking for employment for extended periods of time
will withdraw from the labor market due to losing hope in periods of economic
recession. According to this hypothesis, it is expected that the labor force
participation rate will increase once the unemployment rate decreases and vice
versa. The added worker effect anticipates that if the worker who provides the
livelihood of the family becomes unemployed, other members of the family will
participate in the labor market. According to this hypothesis, it is expected
that the labor force participation rate will decrease once the unemployment
rate decreases and vice versa. This study aims to test whether these two
effects apply to selected Euro zone countries (PIIGGS-Portugal, Ireland, Italy,
Greece, Great Britain, Spain) during the European Debt Crisis
.

References

  • BAŞLEVENT, Cem, Özlem Onaran (2003), “Are Married Women in Turkey More Likely to Become Added or Discouraged Workers?”, CEIS, Fondazione Giacomo Brodolini and Blackwell Publishing, s.439-458.
  • BINGLEY, Paul, Ian Walker (2001), “Household Unemployment and the Labour Supply of Married Women”, Economica, Vol. 68, No. 270, s. 157-185.
  • BREADTMANN, Julia, Sebastian Otten, Christian Rulff (2014), “Husband’s Unemployment and Wife’s Labor Supply – The Added Worker Effect Across Europe”, Ruhr Economic Papers 484, RWI, Ruhr-University Bochum,s1-34
  • DEĞİRMENCİ, Serkan, İpekİlkkaracan (2013), “Economic Crises and the Added Worker Effect in the Turkish Labor Market”, The Levy Economics Institute Working Paper No:774, s.1-47.
  • EVIAS, Peter (2016), “The Mystery of Spain’s Perpetual Jobs Problem”, The New York Time May 2, http://www.nytimes.com/2016/05/03/upshot/spains-jobless-numbers-almost-look-like-misprints.html, (erişimtarihi 7.10.2016).
  • GONG, Xiaodong (2010), “The Added Worker Effect and the Discouraged Worker Effect forMarried Women in Australia”, IZA Discussion Paper No. 4816, s.1-24.
  • HECKMAN, James J., Thomas E. Macurdy (1980), “A Life Cycle Model of Female Labour Supply”, The Review of Economic Studies, Vol. 47, No. 1, Econometrics Issue, 47-74.
  • IMF (2014), Portugal, IMF Country Report No.14/102, s.1-87
  • KUCH, Peter J, Samuel Sharir (1978), “Added- and Discouraged-Worker Effects in Canada, 1953-74”, The Canadian Journal of Economics, Vol. 11, No.1, s. 112-120.
  • LUNDBERG, Shelly (1985), “The Added Worker Effect”, Journal of Labor Economics, 1985, vol. 3, no. 1,
  • YAMAK, Nebiye, Rahmi Yamak (1999), “Türkiye’de İşsizlik Oranı İle İşgücüne Katılma Oranı Arasındaki İlişki”, Kamu-İş İş Hukuku ve İktisat Dergisi, 5(1), ss. 17-27.
  • MANKART, Jochen, RigasOikonomou (2016), “The Rise of the Added Worker Effect”, Economics Letters 143, 48–51.
  • MINCER, Jacob (1962), “Labor Force Participation of Married Women:A Study of Labor Supply”, Aspects of Labor Economics, Princeton University Press, 63-105.
  • MOUNT, Ian (2015), “How Spain Wound Up With One of The Worst Job Markets in The World”, Fortune, December 1, http://fortune.com/2015/12/01/spain-job-market/, (erişimtarihi 7.10.2016)
  • O,HAGAN, John (2016), “Long-term Unemployment a Bigger Problem Than Emigration”, http://www.irishtimes.com/business/economy/long-term-unemployment-a-bigger-problem-than-emigration-1.1704360.
  • PETTINGER, Tejvan (2014), “Policies to Reduce Unemployment in Greece”, ECONOMICS, http://www.economicshelp.org/blog/10284/economics/policies-reduce-unemployment-greece/, (erişim tarihi 7.10.2016).
  • PIAZA, Gabriela, Martin Myant (2015), Italy’sLabour Market Reforms of 2012: DidTheyReduce Unemployment?, ETUI WorkingPaper 2015.11, s.1-37
  • STEPHENS, Melvin (2000), “Worker Displacement and theAdded Worker Effect”, National Bureau of Economic Research, 1-27.
  • TDK (2016), Cesareti Kırılmış Emek, http://www.tdk.gov.tr /index.php?option=com_bts&view= bts&kategori1=veritbn&kelimesec=62234, (erişim tarihi 25.08.2016).

Avrupa Borç Krizi Çerçevesinde Cesareti Kırılmış İşçi Etkisi ve İlave-İşçi Etkisi

Year 2019, Volume: 18 Issue: 1, 522 - 534, 22.01.2019
https://doi.org/10.21547/jss.425024

Abstract



Avrupa’da yaşanan borç krizinin ülke ekonomileri üzerinde
birçok olumsuz etkisi olmuştur. Bu olumsuz etkilerden biride istihdam
üzerinedir. Literatürde işgücüne katılma oranı ile işsizlik arasındaki ilişki
temelde iki hipotez çerçevesinde incelenmiştir. Bu hipotezler “Cesareti
Kırılmış İşçi Etkisi” ve “İlave –İşçi Etkisi”dir. Cesareti kırılmış işçi
etkisine göre ekonomik durgunluğun olduğu dönemlerde uzun süredir iş arayan
bireylerin iş bulma ümidini yitirmeleri sonucunda emek piyasalarından
ayrılacağını öngörmektedir. Bu öngörüde işsizlik oranı azaldığında işgücüne
katılma oranının artacağı ya da tersi durumun oluşması beklenmektedir.
İlave-işçi etkisi ise yine ekonomik durgunluğun olduğu dönemlerde ailenin
geçimini sağlayan kişinin işsiz kalması sonucu diğer aile bireylerinin emek
piyasasına katılacağını öngörmektedir. Bu öngörüde işsizlik oranı azaldığında
işgücüne katılma oranının da azalacağı ya da tersi durumun oluşması
beklenmektedir. Çalışmamızda bu iki etkinin Avrupa borç krizinde seçilmiş Euro
bölgesi ülkelerinde (PIIGGS-Portekiz, İrlanda, İtalya, Yunanistan, Birleşik
Krallık, İspanya) geçerli olup olmadığı test edilecektir.




References

  • BAŞLEVENT, Cem, Özlem Onaran (2003), “Are Married Women in Turkey More Likely to Become Added or Discouraged Workers?”, CEIS, Fondazione Giacomo Brodolini and Blackwell Publishing, s.439-458.
  • BINGLEY, Paul, Ian Walker (2001), “Household Unemployment and the Labour Supply of Married Women”, Economica, Vol. 68, No. 270, s. 157-185.
  • BREADTMANN, Julia, Sebastian Otten, Christian Rulff (2014), “Husband’s Unemployment and Wife’s Labor Supply – The Added Worker Effect Across Europe”, Ruhr Economic Papers 484, RWI, Ruhr-University Bochum,s1-34
  • DEĞİRMENCİ, Serkan, İpekİlkkaracan (2013), “Economic Crises and the Added Worker Effect in the Turkish Labor Market”, The Levy Economics Institute Working Paper No:774, s.1-47.
  • EVIAS, Peter (2016), “The Mystery of Spain’s Perpetual Jobs Problem”, The New York Time May 2, http://www.nytimes.com/2016/05/03/upshot/spains-jobless-numbers-almost-look-like-misprints.html, (erişimtarihi 7.10.2016).
  • GONG, Xiaodong (2010), “The Added Worker Effect and the Discouraged Worker Effect forMarried Women in Australia”, IZA Discussion Paper No. 4816, s.1-24.
  • HECKMAN, James J., Thomas E. Macurdy (1980), “A Life Cycle Model of Female Labour Supply”, The Review of Economic Studies, Vol. 47, No. 1, Econometrics Issue, 47-74.
  • IMF (2014), Portugal, IMF Country Report No.14/102, s.1-87
  • KUCH, Peter J, Samuel Sharir (1978), “Added- and Discouraged-Worker Effects in Canada, 1953-74”, The Canadian Journal of Economics, Vol. 11, No.1, s. 112-120.
  • LUNDBERG, Shelly (1985), “The Added Worker Effect”, Journal of Labor Economics, 1985, vol. 3, no. 1,
  • YAMAK, Nebiye, Rahmi Yamak (1999), “Türkiye’de İşsizlik Oranı İle İşgücüne Katılma Oranı Arasındaki İlişki”, Kamu-İş İş Hukuku ve İktisat Dergisi, 5(1), ss. 17-27.
  • MANKART, Jochen, RigasOikonomou (2016), “The Rise of the Added Worker Effect”, Economics Letters 143, 48–51.
  • MINCER, Jacob (1962), “Labor Force Participation of Married Women:A Study of Labor Supply”, Aspects of Labor Economics, Princeton University Press, 63-105.
  • MOUNT, Ian (2015), “How Spain Wound Up With One of The Worst Job Markets in The World”, Fortune, December 1, http://fortune.com/2015/12/01/spain-job-market/, (erişimtarihi 7.10.2016)
  • O,HAGAN, John (2016), “Long-term Unemployment a Bigger Problem Than Emigration”, http://www.irishtimes.com/business/economy/long-term-unemployment-a-bigger-problem-than-emigration-1.1704360.
  • PETTINGER, Tejvan (2014), “Policies to Reduce Unemployment in Greece”, ECONOMICS, http://www.economicshelp.org/blog/10284/economics/policies-reduce-unemployment-greece/, (erişim tarihi 7.10.2016).
  • PIAZA, Gabriela, Martin Myant (2015), Italy’sLabour Market Reforms of 2012: DidTheyReduce Unemployment?, ETUI WorkingPaper 2015.11, s.1-37
  • STEPHENS, Melvin (2000), “Worker Displacement and theAdded Worker Effect”, National Bureau of Economic Research, 1-27.
  • TDK (2016), Cesareti Kırılmış Emek, http://www.tdk.gov.tr /index.php?option=com_bts&view= bts&kategori1=veritbn&kelimesec=62234, (erişim tarihi 25.08.2016).
There are 19 citations in total.

Details

Primary Language English
Subjects Business Administration
Journal Section Economics
Authors

Armağan Türk

Rengin Ak

Publication Date January 22, 2019
Submission Date May 18, 2018
Acceptance Date January 8, 2019
Published in Issue Year 2019 Volume: 18 Issue: 1

Cite

APA Türk, A., & Ak, R. (2019). The Discouraged Worker Effect and the Added Worker Effect within the Framework of European Debt Crisis. Gaziantep University Journal of Social Sciences, 18(1), 522-534. https://doi.org/10.21547/jss.425024