Professor Mark J. Perry's Blog for Economics and Finance
Posted 8:12 AM Post Link
More interesting is how close to lockstep they run in as far as the up and down. Is this a reflection of a "Global Economy", their being closely tied to the dollar, or something less obvious?It suggests that the state of the economy doesn't tie as much as we are told it does to national policies, at least not on a "one nation" basis... It might be that there is an interlocking effect of differing policies which drives them up and down together, but it suggests a lack of value to the idea that each national economy is strongly independent.
obloodyhell:It may be more interesting that you think - it looks like the Euro area lags the U.S., which suggests that the employment situation might worsen there in the months ahead.Also interesting is that the Euro area's unemployment levels would seem to be less volatile that those in the U.S. Partly that's due to having the rates for individual European countries averaged together, but I wonder how much might have to do with Europe's relative lack of economic dynamicism. With Europe's labor laws favoring rigidity, it would make sense that their unemployment levels would be less volatile.
Hmmm, I'm wondering just how suggestive that chart really is suggestive of Euro policies or American policies for that matter obh?Consider these numbers: Unemployment rates in the European Union and selected member countries, civilian labor force basis, seasonally adjusted, 1995-2008Spain for quite some time has had a very strong socialist/communist presence and it seems that those policies are in part reflected in its unemployment numbers...Also according to this two year old Financial Times article there is this situation: Falling birth rates will cut the European Union’s potential annual economic growth rate from 2.2 per cent to 1.9 per cent between 2011 and 2030, and to 1.3 per cent from 2031 to 2050, says the European Commission. Healthcare spending will increase from 6.4 per cent of GDP in 2004 to 8 per cent in 2050. There are huge implications for pension provision. By 2050 one-third of the population will be aged 65 or more, as against one-fifth now...How is this effecting both policy and the employment numbers?
The chart is somewhat of an apples to oranges comparison.The BLS does perform an adjustment series for 10 countries in an attempt to better match or approximate US concepts to the various country data sets.The BLS also undertook a June 2000 study which supports the position that the EU unemployment rates were overstated by about 0.4% and the Canada rate by about 0.9% relative to US rates. Of course, these differences would change over time.Bottom line: It is worse for the US than the chart depicts.
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Dr. Mark J. Perry is a professor of economics and finance in the School of Management at the Flint campus of the University of Michigan.
Perry holds two graduate degrees in economics (M.A. and Ph.D.) from George Mason University near Washington, D.C. In addition, he holds an MBA degree in finance from the Curtis L. Carlson School of Management at the University of Minnesota. In addition to a faculty appointment at the University of Michigan-Flint, Perry is also a visiting scholar at The American Enterprise Institute in Washington, D.C.
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