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An examination of hysteresis hypothesis on natural rate of unemployment in the case of Turkey

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  • Yakup Kucukkale

    (Ondokuz Mayis University)

Abstract

In this study, the Hysteresis Hypothesis that assumes the natural rate of unemployment follows the last period’s realised unemployment was examined for the Turkish case by using annual data for the period of 1950-1995. The technique used in this study is the Kalman – Filter that is using as an influential technique to estimate the parameters of time varying regressions. Obtaining results show that the hypothesis is valid for the Turkish case in sample period. But, this quite weak validity needs additional explanatory variables to prove hypothesis completely.

Suggested Citation

  • Yakup Kucukkale, 2002. "An examination of hysteresis hypothesis on natural rate of unemployment in the case of Turkey," Labor and Demography 0211003, University Library of Munich, Germany.
    • Handle: RePEc:wpa:wuwpla:0211003
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    References listed on IDEAS

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    1. Hall, Robert E, 1978. "Stochastic Implications of the Life Cycle-Permanent Income Hypothesis: Theory and Evidence," Journal of Political Economy, University of Chicago Press, vol. 86(6), pages 971-987, December.
    2. Harvey,Andrew C., 1991. "Forecasting, Structural Time Series Models and the Kalman Filter," Cambridge Books, Cambridge University Press, number 9780521405737, January.
    3. John Y. Campbell & N. Gregory Mankiw, 1987. "Are Output Fluctuations Transitory?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 102(4), pages 857-880.
    4. Nelson, Charles R. & Plosser, Charles I., 1982. "Trends and random walks in macroeconmic time series : Some evidence and implications," Journal of Monetary Economics, Elsevier, vol. 10(2), pages 139-162.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    hysteresis kalman filter unemployment;

    JEL classification:

    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy

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