THE IMPACT OF TFP GROWTH ON STEADY-STATE UNEMPLOYMENT
Theoretical predictions of the impact of total factor productivity (TFP) growth on unemployment are ambiguous, and depend on the extent to which new technology is embodied in new jobs. We evaluate a model with embodied and disembodied technology, capitalization, and creative destruction effects. In econometric estimates with a panel of industrial countries we find a large negative impact of TFP growth on unemployment, which implies that embodied technology and creative destruction play no role in the steady-state dynamics of unemployment. Capitalization effects explain some of the estimated impact but a part remains unexplained. Copyright 2007 by the Economics Department Of The University Of Pennsylvania And Osaka University Institute Of Social And Economic Research Association.
Year of publication: |
2007
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Authors: | Pissarides, Christopher A. ; Vallanti, Giovanna |
Published in: |
International Economic Review. - Department of Economics. - Vol. 48.2007, 2, p. 607-640
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Publisher: |
Department of Economics |
Saved in:
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