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dc.contributor.authorKaranassou, Marikaen_US
dc.contributor.authorSala, Héctoren_US
dc.date.accessioned2008-10-10en_US
dc.date.accessioned2010-07-07T11:30:06Z-
dc.date.available2010-07-07T11:30:06Z-
dc.date.issued2008en_US
dc.identifier.piurn:nbn:de:101:1-20081014101en_US
dc.identifier.urihttp://hdl.handle.net/10419/34851-
dc.description.abstractThe evolution of Spanish unemployment has been quite idiosyncratic. The full employment levels of the early seventies were followed by unemployment rates that were the highest within the OECD countries in the aftermath of the oil price shocks. While unemployment was extremely persistent in most of the eighties and nineties, it experienced its sharpest decline in recent years. We investigate the determinants of this unemployment trajectory using the analytical framework of the chain reaction theory (CRT). We show that unemployment may not gravitate towards its natural rate due to frictional growth, a phenomenon that arises from the interplay of lagged adjustment processes and growing exogenous variables in a dynamic system with spillovers. The empirical analysis distinguishes four periods: (i) 19781985, (ii) 19861990, (iii) 19911994, (iv) 19952005, and finds that capital accumulation is a crucial driving force of unemployment. Thus, our theoretical and empirical results question the key role of the natural rate in policy making.en_US
dc.language.isoengen_US
dc.publisherIZA Bonnen_US
dc.relation.ispartofseriesIZA discussion papers 3712en_US
dc.subject.jelE22en_US
dc.subject.ddc330en_US
dc.subject.keywordLabour market dynamicsen_US
dc.subject.keywordfrictional growthen_US
dc.subject.keywordchain reaction theoryen_US
dc.subject.keywordcapital accumulationen_US
dc.subject.keywordimpulse response functionen_US
dc.subject.stwArbeitslosigkeiten_US
dc.subject.stwVolatilitäten_US
dc.subject.stwInvestitionen_US
dc.subject.stwSpanienen_US
dc.titleThe rise and fall of Spanish unemployment: a chain reaction theory perspectiveen_US
dc.typeWorking Paperen_US
dc.identifier.ppn581598598en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungen-
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