Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/26341 
Year of Publication: 
2008
Series/Report no.: 
CESifo Working Paper No. 2296
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
Openness for trade can have positive welfare effects in terms of higher growth. But increased openness may also increase uncertainty through a higher volatility of employment. We use regional data from Germany to test whether openness for trade has an impact on volatility. We find a downward trend in the unconditional volatility of employment, which has been interrupted by the re-unification period. Patterns are similar to those for output volatility. The conditional volatility of employment, measuring idiosyncratic developments across states, in contrast, has remained fairly unchanged. In contrast to evidence for the US, we do not find evidence for a significant link between employment volatility and trade openness.
Subjects: 
employment volatility
trade openness
regional labour markets
JEL: 
F41
E32
R23
Document Type: 
Working Paper
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