Labor reallocation: panel evidence from U.S. States

Bakas, D. ORCID: 0000-0003-4771-4505, Panagiotidis, T. and Pelloni, G., 2013. Labor reallocation: panel evidence from U.S. States. Working Paper. Rimini, Italy: The Rimini Centre for Economic Analysis.


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This paper re-examines Lilien’s sectoral shifts hypothesis for U.S. unemployment. We employ a monthly panel that spans from 1990:01 to 2011:12 for 48 U.S. states. Panel unit root tests that allow for cross-sectional dependence reveal the stationarity of unemployment. Within a framework that takes into account dynamics, parameter heterogeneity and cross-sectional dependence in the panel, we show that sectoral reallocation is significant not only at the aggregate level but also at the state level. The magnitude and the statistical significance of the latter as measured by Lilien’s index increases when both heterogeneity and cross-sectional dependence are taken into account.

Item Type: Working paper
Description: Working paper series: WP 26_13
Creators: Bakas, D., Panagiotidis, T. and Pelloni, G.
Publisher: The Rimini Centre for Economic Analysis
Place of Publication: Rimini, Italy
Date: May 2013
Divisions: Schools > Nottingham Business School
Depositing User: Jonathan Gallacher
Date Added: 15 Feb 2017 13:12
Last Modified: 09 Jun 2017 14:12

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