ECON20001 Chapter 8: Chapter 8 The Phillips Curve, the Natural Rate of Unemployment and Inflation
29 Jun 2020
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Document Summary
Non-institutional civilian population = number of people potentially available for civilian employment. Labor force = people working (employed) + people looking for work (unemployed) Out of the labor force = neither working nor looking for work. Active labor market = one which has many separations and many hires, and many workers entering and exiting unemployment. Sclerotic labor market = one with few separations and few hires, and a stagnant unemployment pool. Duration of unemployment = average length of time people spend unemployed. Discouraged workers = those not actively looking for a job but will want a job. Employment rate = employed / non-institutional civilian population. High unemployment --> employed workers face a higher probability of losing their job. High unemployment --> unemployed workers face a lower probability of finding a job + expect to remain unemployed for a longer time.
