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Data and Code for: Estimating Hysteresis Effects

Principal Investigator(s): View help for Principal Investigator(s) Francesco Furlanetto, Central Bank of Norway; Antoine Lepetit, Board of Governors of the Federal Reserve System; Ørjan Robstad, Central Bank of Norway; Juan Rubio-Ramirez, Emory University; Pål Ulvedal, Bank of Norway

Version: View help for Version V1

Name	File Type	Size	Last Modified
Manuscript			01/25/2024 10:17:AM
Replication_files			01/26/2024 09:38:PM
README.pdf	application/pdf	146.7 KB	01/27/2024 05:05:AM

Project Citation:

Furlanetto, Francesco, Lepetit, Antoine, Robstad, Ørjan, Rubio-Ramirez, Juan, and Ulvedal, Pål. Data and Code for: Estimating Hysteresis Effects. Nashville, TN: American Economic Association [publisher], 2024. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2024-12-10. https://doi.org/10.3886/E194141V1

Project Description

Summary: In this paper we identify demand shocks that can have a permanent effect on output through hysteresis effects. We call these shocks permanent demand shocks. They are found to be quantitatively important in the United States, in particular in samples starting in the 1980s. Recessions driven by permanent demand shocks lead to a permanent decline in employment and investment, while output per worker is largely unaffected. We find strong evidence that hysteresis transmits through a rise in long-term unemployment and a decline in labor force participation and disproportionately affects the least productive workers.

Scope of Project

JEL Classification:
      A10 General Economics: General
      A11 Role of Economics; Role of Economists; Market for Economists
      A12 Relation of Economics to Other Disciplines

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Published Versions

V2 [2025-03-27]

V1 [2024-12-10]

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