Structural Unemployment

Public Policy Brief No. 13-6
by Peter Diamond

Whenever unemployment stays high for an extended period, it is common to see analyses, statements, and rebuttals about the extent to which the high unemployment is structural, not cyclical. This brief views the Beveridge curve pattern of unemployment and vacancy rates and the related matching function as proxies for the functioning of the labor market, and explores issues in that proxy relationship that complicates such analyses.

JEL Classifications: E24, E32, E6, J23

Full-text brief pdf