Cointegration and Structural Breaks in German Employment – An Error-Correction Interpretation / Kointegration und Strukturbrüche in der deutschen Beschäftigung – Eine Fehlerkorrektur-Auslegung
1997 ◽
Vol 216
(2)
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Keyword(s):
Long Run
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SummaryIn order to differentiate between unit root-persistence and structural break-hysteresis we estimate two types of cointegration models for West German employment. The standard model is compared with a model including structural breaks in the long-run relation between employment and its determinants. Our estimation shows that persistence is probably attributed to structural breaks in the long-run relation and not to a degenerating adjustment process. Thus, a unit root in the standard model possibly reveals a misspecification in the form of an ex-ante exclusion of the possibility of structural breaks in the equilibrium relation due to serious economic shocks.
Keyword(s):
2019 ◽
Vol 8
(2)
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pp. 283-290
Keyword(s):
2008 ◽
Vol 15
(2)
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pp. 245-263
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Keyword(s):
2018 ◽
Vol 29
(2)
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pp. 368-384
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