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The Impact of Economic and Financial Crises on Unemployment Rate in European Union

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  • Jianu, Ionuț

Abstract

This paper aims at clustering the European Union member states into two groups of countries (country-groups with inclusive institutions / extractive institutions) and, depending on them, to assess the impact of financial shocks on unemployment during 2003-2017 period, given that the unemployment was the main channel by which the economic and financial crisis influenced the social developments in the European Union. In order to achieve the objective of the paper, I used panel Panel Estimated Generalized Least Squares method for both clusters, this being weighted by Period SUR option to remove ex-ante the possible inconveniences of the model. The quality of institutions wasn't used yet as a clustering criterion for unemployment assessments and this approach can bring a real value added in this research area. The results show that the institutios quality are a relevant explanatory factor for economic and social development. This assessment also confirm the lower resilience of labour markets at the effects of the economic and financial crisis in the member states with extractive institutions.

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  • Jianu, Ionuț, 2018. "The Impact of Economic and Financial Crises on Unemployment Rate in European Union," EconStor Conference Papers 194294, ZBW - Leibniz Information Centre for Economics.
    • Handle: RePEc:zbw:esconf:194294
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    References listed on IDEAS

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    1. Ionuţ JIANU, 2017. "The impact of private sector credit on income inequalities in European Union (15 member states)," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 0(2(611), S), pages 61-74, Summer.
    2. Tito Boeri & Juan F. Jimeno, 2015. "The unbearable divergence of unemployment in europe," Working Papers 1534, Banco de España.
    3. Robert Solow, 2000. "Unemployment in the United States and in Europe - A Contrast and the Reasons," CESifo Working Paper Series 231, CESifo.
    4. Mădălina AVRAM & Constantin POSTOIU, 2016. "Territorial patterns of development in the European Union," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 0(1(606), S), pages 77-88, Spring.
    5. Lo Duca, Marco & Koban, Anne & Basten, Marisa & Bengtsson, Elias & Klaus, Benjamin & Kusmierczyk, Piotr & Lang, Jan Hannes & Detken, Carsten & Peltonen, Tuomas, 2017. "A new database for financial crises in European countries," ESRB Occasional Paper Series 13, European Systemic Risk Board.
    6. Ionut Jianu, 2020. "The impact of private sector credit on income inequalities in European Union (15 member states)," Papers 2007.11408, arXiv.org.
    7. Calvo, Guillermo & Coricelli, Fabrizio & Ottonello, Pablo, 2012. "The Labor Market Consequences of Financial Crises With or Without Inflation: Jobless and Wageless Recoveries," CEPR Discussion Papers 9218, C.E.P.R. Discussion Papers.
    8. Andreea Florentina NICOLESCU, 2017. "Current challenges of the European security caused by the refugee crisis. The EU's fight against terrorism," CES Working Papers, Centre for European Studies, Alexandru Ioan Cuza University, vol. 9(3), pages 174-194, October.
    9. Misbah Tanveer Choudhry & Enrico Marelli & Marcello Signorelli, 2012. "Youth unemployment rate and impact of financial crises," International Journal of Manpower, Emerald Group Publishing Limited, vol. 33(1), pages 76-95, March.
    10. Tito Boeri & Pietro Garibaldi & Espen R Moen, 2013. "Financial Shocks and Labor: Facts and Theories," IMF Economic Review, Palgrave Macmillan;International Monetary Fund, vol. 61(4), pages 631-663, December.
    11. Jianu, Ionuț, 2017. "The impact of private sector credit on income inequalities in European Union (15 member states)," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 0(2 (611)), pages 61-74.
    12. Robert Solow, 2000. "Unemployment in the United States and in Europe : a contrast and the reasons ; the European unemployment problem," CESifo Forum, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 1(01), pages 3-5, October.
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    Keywords

    unemployment; financial shocks; crisis; dummy; youth;
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