As a measure of labor market strength, the raw employment-to-population ratio (EPOP) confounds employment outcomes with labor supply behavior. Movement in the EPOP depends on the relative movements of the employment rate (one minus the unemployment rate) and the labor force participation rate....

In this paper we test for the existence of compensating differentials for unemployment risk in an era before unemployment insurance. Using information gathered from manufacturing worker surveys conducted during the 1880s in New Jersey, we find that workers who faced higher probabilities of...

We present evidence that low-skill workers received larger compensating differentials than more skilled workers when facing unanticipated unemployment in an era without unemployment insurance. Using information from surveys of New Jersey workers conducted during the 1880s, we test the theory of...

This paper explores evidence for positive hysteresis in the labor market. Using data from the National Longitudinal Surveys of Youth, we find that negative labor market outcomes during high unemployment periods are mitigated by exposure to a high-pressure economy during the preceding expansion....

This paper calculates the cost of an unemployment shock in terms of family welfare. We find that, overall, families face an average annualized expected dollar equivalent welfare loss of $1,156 when the unemployment rate rises by 1 percentage point. The average welfare loss for married families...

As a measure of labor market strength, the raw employment-to-population ratio (EPOP) confounds employment outcomes with labor supply behavior. Movement in the EPOP depends on the relative movements of the employment rate (one minus the unemployment rate) and the labor force participation rate....