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A Cohort Model of Labor Force Participation

Author

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  • Marianna Kudlyak

Abstract

We estimate a trend in the aggregate labor force participation rate using the age-gender and the birth cohort effects in the labor force participation rates of different demographic groups and the actual demographic composition of the population. We find that, in 2012, the aggregate labor force participation rate is close to its trend.

Suggested Citation

  • Marianna Kudlyak, 2013. "A Cohort Model of Labor Force Participation," Economic Quarterly, Federal Reserve Bank of Richmond, issue 1Q, pages 25-43.
    • Handle: RePEc:fip:fedreq:00002
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    References listed on IDEAS

    as
    1. Acemoglu,Daron & Arellano,Manuel & Dekel,Eddie (ed.), 2013. "Advances in Economics and Econometrics," Cambridge Books, Cambridge University Press, number 9781107016064, January.
    2. Christopher J. Erceg & Andrew T. Levin, 2014. "Labor Force Participation and Monetary Policy in the Wake of the Great Recession," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 46(S2), pages 3-49, October.
    3. Acemoglu,Daron & Arellano,Manuel & Dekel,Eddie (ed.), 2013. "Advances in Economics and Econometrics," Cambridge Books, Cambridge University Press, number 9781107638105, January.
    4. Jesse Rothstein, 2011. "Unemployment Insurance and Job Search in the Great Recession," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 42(2 (Fall)), pages 143-213.
    5. Maria E. Canon & Peter Debbaut & Marianna Kudlyak, 2013. "A closer look at the decline in the labor force participation rate," The Regional Economist, Federal Reserve Bank of St. Louis, issue October.
    6. Veracierto, Marcelo, 2008. "On the cyclical behavior of employment, unemployment and labor force participation," Journal of Monetary Economics, Elsevier, vol. 55(6), pages 1143-1157, September.
    7. Bruce Fallick & Jonathan F. Pingle, 2006. "A cohort-based model of labor force participation," Finance and Economics Discussion Series 2007-09, Board of Governors of the Federal Reserve System (U.S.).
    8. Mark E. Schweitzer & Murat Tasci, 2013. "What constitutes substantial employment gains in today’s labor market?," Economic Commentary, Federal Reserve Bank of Cleveland, issue Jun.
    9. Daniel Aaronson & Jonathan Davis & Luojia Hu, 2012. "Explaining the decline in the U.S. labor force participation rate," Chicago Fed Letter, Federal Reserve Bank of Chicago, issue Mar.
    10. Stephanie Aaronson & Bruce Fallick & Andrew Figura & Jonathan Pingle & William Wascher, 2006. "The Recent Decline in the Labor Force Participation Rate and Its Implications for Potential Labor Supply," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 37(1), pages 69-154.
    11. Acemoglu,Daron & Arellano,Manuel & Dekel,Eddie (ed.), 2013. "Advances in Economics and Econometrics," Cambridge Books, Cambridge University Press, number 9781107016057, January.
    12. Acemoglu,Daron & Arellano,Manuel & Dekel,Eddie (ed.), 2013. "Advances in Economics and Econometrics," Cambridge Books, Cambridge University Press, number 9781107674165, January.
    13. Acemoglu,Daron & Arellano,Manuel & Dekel,Eddie (ed.), 2013. "Advances in Economics and Econometrics," Cambridge Books, Cambridge University Press, number 9781107627314, January.
    14. Acemoglu,Daron & Arellano,Manuel & Dekel,Eddie (ed.), 2013. "Advances in Economics and Econometrics," Cambridge Books, Cambridge University Press, number 9781107016040, January.
    15. Julie L. Hotchkiss & Fernando Rios-Avila, 2013. "Identifying Factors behind the Decline in the U.S. Labor Force Participation Rate," Business and Economic Research, Macrothink Institute, vol. 3(1), pages 257-275, June.
    16. Marianna Kudlyak & Felipe Schwartzman, 2012. "Accounting for unemployment in the Great Recession : nonparticipation matters," Working Paper 12-04, Federal Reserve Bank of Richmond.
    Full references (including those not matched with items on IDEAS)

    Citations

    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Labor force participation: Is a trend or a cycle at work?
      by ? in FRED blog on 2015-05-07 18:00:36

    Citations

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    Cited by:

    1. James B. Bullard, 2014. "The rise and fall of labor force participation in the U.S," The Regional Economist, Federal Reserve Bank of St. Louis, April.
    2. Stephanie Aaronson & Tomaz Cajner & Bruce Fallick & Felix Galbis-Reig & Christopher Smith & William Wascher, 2014. "Labor Force Participation: Recent Developments and Future Prospects," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 45(2 (Fall)), pages 197-275.
    3. Jorgenson, Dale & Ho, Mun & Samuels, Jon, 2019. "Recent U.S. economic performance and prospects for future growth," Journal of Policy Modeling, Elsevier, vol. 41(3), pages 459-476.
    4. Stephen Byrne & Martin D. O’Brien, 2017. "Understanding Irish Labour Force Participation," The Economic and Social Review, Economic and Social Studies, vol. 48(1), pages 27-60.
    5. Sinem Kilic Celik & M. Ayhan Kose & Franziska Ohnsorge, 2023. "Potential Growth Prospects: Risks, Rewards and Policies," CAMA Working Papers 2023-19, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.
    6. Andreas Hornstein & Marianna Kudlyak, 2019. "Aggregate Labor Force Participation and Unemployment and Demographic Trends," Working Paper 19-8, Federal Reserve Bank of Richmond.
    7. Jeremy W Bray & Brooks Depro & Dorren McMahon & Marion Siegle & Lee Mobley, 2016. "Disconnected Geography: A Spatial Analysis of Disconnected Youth in the United States," Journal of Labor Research, Springer, vol. 37(3), pages 317-342, September.
    8. Brian Micallef, "undated". "Estimating the Impact on potential output of structural reforms to Increase the female participation rate," CBM Policy Papers PP/03/2015, Central Bank of Malta.
    9. James B. Bullard, 2014. "The rise and fall of labor force participation in the United States," Review, Federal Reserve Bank of St. Louis, vol. 96(1), pages 1-12.
    10. Jonathan Lecznar & Pierre-Daniel G. Sarte & Robert Sharp, 2013. "Characterizing the Unusual Path of U.S. Output During and After the Great Recession," Economic Quarterly, Federal Reserve Bank of Richmond, issue 3Q, pages 163-192.
    11. Brian Micallef, 2018. "Estimating the Impact of Structural Reforms to Increase the Female Participation Rate in Malta," International Journal of Social Science Studies, Redfame publishing, vol. 6(8), pages 73-84, August.
    12. Congressional Budget Office, 2018. "CBO’s Projection of Labor Force Participation Rates: Working Paper 2018-04," Working Papers 53616, Congressional Budget Office.

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    More about this item

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure

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