Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/129751
Authors: 
Bräuninger, Michael
Pannenberg, Markus
Year of Publication: 
2000
Series/Report no.: 
DIW Discussion Papers 230
Abstract: 
Does a country's level of unemployment have an impact on the long-run growth rate? Incorporating unemployment into a generalised Solow-type growth model yields some answers. In the traditional Solow model, unemployment has no long-run influence on the growth rate and the level of productivity. The long-run level of productivity is reduced if higher unemployment leads to less formal education or to less learning-by-doing. If we allow for endogenous growth, unemployment reduces long-run productivity growth. Using panel data from 13 OECD countries from 1960 to 1990, we find evidence that an increase in unemployment scales down the long-run level of productivity.
Subjects: 
Growth
Equilibrium Unemployment
Panel Data
JEL: 
O40
O57
E24
Document Type: 
Working Paper

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