The Beveridge Curve in the OECD. Before and after the Great Recession

This paper analyses the Beveridge Curve across nine OECD countries from 1985 to 2012. Besides allowing for some customary labour-market institutions, we assess the role of various kinds of structural factors (technological progress, globalisation, oil prices) and of the current recession on the Curve. Significant institutional variables include unemployment benefits, the tax wedge, active labour-market policies and employment protection legislation (the latter improving the unemployment-vacancies trade-off). Technological progress (R&D intensity) shifts the Curve outwards, producing evidence in support of a creative destruction effect. Globalisation and unfavourable oil price shocks also shift the Curve outwards. Structural relationships seem to be stable throughout the 2008-2012 period, suggesting that the Great Recession mainly implied moves along the Curve