The Elasticity of Demand for Labour in Australia

Lewis, Phil; MacDonald, Garry

doi:10.1111/1475-4932.00036

Cited by 33 publications

(98 citation statements)

References 17 publications

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“…In terms of the estimation procedure, Lewis and MacDonald (2002) apply the same econometric technique used in this paper (and generally in the papers which estimate CRT models):…”

Section: Some Key Features Of the Literature On Australiamentioning

confidence: 99%

“…It can be shown that the ARDL provides a robust econometric tool for estimating and testing the short-and long-run relationships between the variables without having to classify them as I(1) or I(0). In addition, as Lewis and MacDonald (2002) 20), where   ,   , and   represent the (log of) employment, real wage, and real GDP, respectively,  is a time-trend,   denotes the error term, and the 's are constants. They find weak exogeneity for the right-hand side variables and estimate the is in line with the conventional use of output as an exogenous determinant of labour demand.…”

Section: Some Key Features Of the Literature On Australiamentioning

confidence: 99%

“…We replicated the results of Lewis and MacDonald (2002) by using our annual dataset from 1970 to 2006 (see Section 4.1 for data description). In particular, following the ARDL approach, our selected dynamic specification of their labour demand equation features two annual lags (versus their seven quarterly lags) and has the following long-run solution:…”

Section: Some Key Features Of the Literature On Australiamentioning

confidence: 99%

“…Despite using the same econometric technique as Lewis and MacDonald (2002) for the estimation of the labour demand equation, our empirical model in Section 4 differs from theirs (and from most of the existing literature) in two main respects. First, we take into account both Webster's (2003) concerns about the use of output in the labour demand equation, and Pissarides' (1991) intuition that capital stock may yield valuable insights in explaining labour market outcomes in Australia.…”

Section: Some Key Features Of the Literature On Australiamentioning

confidence: 99%

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Labour Market Dynamics in Australia: What Drives Unemployment?

Karanassou

Sala

2008

SSRN Journal

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. The Institute for the Study of Labor (IZA) in Bonn is a local and virtual international research center and a place of communication between science, politics and business. IZA is an independent nonprofit organization supported by Deutsche Post World Net. The center is associated with the University of Bonn and offers a stimulating research environment through its international network, workshops and conferences, data service, project support, research visits and doctoral program. IZA engages in (i) original and internationally competitive research in all fields of labor economics, (ii) development of policy concepts, and (iii) dissemination of research results and concepts to the interested public. Terms of use: Documents in D I S C U S S I O N P A P E R S E R I E SIZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be available directly from the author. The debate in Australia on the (constant-output) elasticity of labour demand with respect to wages has wrongly sidelined the role of capital stock as a determinant of employment (Webster, 2003). As far back as 1991, Pissarides had argued that the influence of capital stock on the performance of the labour market is crucial but not well understood, a research area which is particularly relevant for Australia. This paper attempts to fill this void by estimating a multi-equation labour market model comprising labour demand, wage setting and labour supply equations. The model is used to examine the causes of the unemployment upturn in 1973-1983 and the subsequent decline in 1993-2006. Our results show that (i) the main determinants of the unemployment rise in the 1970s and early 1980s were wage-push factors, the two oil price shocks and the increase in interest rates, and (ii) the acceleration in capital accumulation was the crucial driving force of unemployment in the 1990s and 2000s. Furthermore, although the recent boom in the terms of trade is equally important, its downward effect on unemployment was partially reversed by the resulting decrease in net foreign demand.JEL Classification: E22, E24, J21

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“…In terms of the estimation procedure, Lewis and MacDonald (2002) apply the same econometric technique used in this paper (and generally in the papers which estimate CRT models):…”

Section: Some Key Features Of the Literature On Australiamentioning

confidence: 99%

Section: Some Key Features Of the Literature On Australiamentioning

confidence: 99%

Section: Some Key Features Of the Literature On Australiamentioning

confidence: 99%

Section: Some Key Features Of the Literature On Australiamentioning

confidence: 99%

See 2 more Smart Citations

Labour Market Dynamics in Australia: What Drives Unemployment?

Karanassou

Sala

2008

SSRN Journal

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“…Until the end of 2008, employers in Serbia were obliged to report all vacancies to the NEB, regardless of the manner of recruitment (via NEB or via internal selection processes), which is why the sample period ends in December 2008. According to economic theory and the empirical literature, the main determinants of labour demand are labour costs (wages) and output (Carne 2007;Lewis -MacDonald 2002). In this respect, the data on GDP (in 2005 constant prices) have been used as a proxy for output, while in terms of labour costs, there were several options available.…”

mentioning

confidence: 99%

Estimating the impact of income tax on personal savings in Serbia: The two channels approach

Ranđelović¹

2016

Acta Oeconomica

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This paper provides an empirical evaluation of the effects of income taxation on personal savings in Serbia, by taking into account both transmitting channels: the direct impact of capital income tax on the rate-of-return and the indirect impact of labour income tax on disposable income. The estimated elasticity of bank deposits to the rate of return of 0.3 and the estimated elasticity of employment income to a labour tax wedge of -0.38 suggest that income tax function aimed at minimising the effi ciency losses should not considerably differentiate the tax burden on labour and capital income. We show that in the case of the introduction of a revenue-neutral income tax, with a single marginal tax rate of 15% and considerably larger labour income exemption, households' savings in Serbia would decline by 0.27%. This means that the negative impact of a rise in the capital income tax wedge on savings would prevail over the positive effects of a labour tax wedge cut. The results imply that the overall possibility to boost savings using tax policy is modest. JEL classifi cation indices: H22, H24, H31

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Determinants of economic growth in Brunei Darussalam

Anaman¹

2004

Journal of Asian Economics

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The Elasticity of Demand for Labour in Australia

Cited by 33 publications

References 17 publications

Labour Market Dynamics in Australia: What Drives Unemployment?

Labour Market Dynamics in Australia: What Drives Unemployment?

Estimating the impact of income tax on personal savings in Serbia: The two channels approach

Determinants of economic growth in Brunei Darussalam

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