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Macroeconomic Unemployment and Structural Unemployment

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  • Pierre Fortin

Abstract

During the 1990s, the lowest sustainable rate of unemployment (LSRU) in Canada declined from the 7.5-to-8% range to perhaps around 6%. Barring an international recession and excessive rigidity on the part of the central bank, Canada could achieve this 6% unemployment level within a few quarters. There is a good persumption that eliminating macroeconomic unemployment and keeping the unemployment rate close to the LSRU level could help reduce structural unemployment.

Suggested Citation

  • Pierre Fortin, 2000. "Macroeconomic Unemployment and Structural Unemployment," Canadian Public Policy, University of Toronto Press, vol. 26(s1), pages 125-130, July.
    • Handle: RePEc:cpp:issued:v:26:y:2000:i:s1:p:125-130
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    References listed on IDEAS

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    1. W. Craig Riddell & Andrew Sharpe, 1998. "The Canada-US Unemployment Rate Gap: An Introduction and Overview," Canadian Public Policy, University of Toronto Press, vol. 24(s1), pages 1-37, February.
    2. Charles Freedman & Tiff Macklem, 1998. "A Comment on "The Great Canadian Slump"," Canadian Journal of Economics, Canadian Economics Association, vol. 31(3), pages 646-665, August.
    3. Franco Modigliani & Lucas Papademos, 1975. "Targets for Monetary Policy in the Coming Year," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 6(1), pages 141-166.
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    6. Joseph Stiglitz, 1997. "Reflections on the Natural Rate Hypothesis," Journal of Economic Perspectives, American Economic Association, vol. 11(1), pages 3-10, Winter.
    7. Tobin, James, 1972. "Inflation and Unemployment," American Economic Review, American Economic Association, vol. 62(1), pages 1-18, March.
    8. Arthur M. Okun, 1973. "Upward Mobility in a High-Pressure Economy," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 4(1), pages 207-262.
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    Cited by:

    1. David Laidler & William B.P. Robson, 2004. "Two Percent Target: The Context, Theory, and Practice of Canadian Monetary Policy since 1991," C.D. Howe Institute Policy Studies, C.D. Howe Institute, number 20041, January.
    2. Mr. Marcello M. Estevão & Ms. Evridiki Tsounta, 2010. "Canada's Potential Growth: Another Victim of the Crisis?," IMF Working Papers 2010/013, International Monetary Fund.

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