Foreign direct investment, exports, gross domestic product and the labor market in Puerto Rico

In this paper, a vector autorregresive model (VAR) is applied to examine the interrelationship among foreign direct investment, exports, Gross Domestic Product (GDP), unemployment rate and labor force participation rate in Puerto Rico, taking into account a time period that includes the fiscal years from 1980 to 2010 -- Four cointegrating vectors were found in the system which indicates that there is a long run relationship between the variables -- The findings suggest that consecutive increases in foreign direct investment inflows could significantly reduce the unemployment rate and increase interest in joining the labor force in Puerto Rico -- The same result also applies to increases in export levels -- The variations in Gross Domestic Product are mainly explained in the long run by the unemployment rate

Mining and Energy Boom, Dutch Disease and Informality in Colombia: a DSGE Approach

The paper develops a Dynamic Stochastic General Equilibrium (DSGE) model, which assesses the macroeconomic and labor market effects derived from simulating a positive shock to the stochastic component of the mining-energy sector productivity. Calibrating the model for the Colombian economy, this shock generates a whole increase in formal wages and a raise in tax revenues, expanding total consumption of the household members. These facts increase non-tradable goods prices relative to tradable goods prices, then real exchange rate decreases (appreciation) and occurs a displacement of productive resources from the tradable (manufacturing) sector to the non-tradable sector, followed by an increase in formal GDP and formal job gains. This situation makes the formal sector to absorb workers from the informal sector through the non-tradable formal subsector, which causes informal GDP to go down. As a consequence, in the net consumption falls for informal workers, which leads some members of the household not to offer their labor force in the informal sector but instead they prefer to keep unemployed. Therefore, the final result on the labor market is a decrease in the number of informal workers, of which a part are in the formal sector and the rest are unemployed.

Unemployed, Now What? The Effect of Immigration on Unemployment Transitions of Native-born Workers in the United States

Although one would expect the unemployed to be the population most likely affected by immigration, most of the studies have concentrated on investigating the effects immigration has on the employed population. Little is known of the effects of immigration on labor market transitions out of unemployment. Using the basic monthly Current Population Survey from 2001 and 2013 we match data for individuals who were interviewed in two consecutive months and identify workers who transition out of unemployment. We employ a multinomial model to examine the effects of immigration on the transition out of unemployment, using state-level immigration statistics. The results suggest that immigration does not affect the probabilities of native-born workers finding a job. Instead, we find that immigration is associated with smaller probabilities of remaining unemployed, but it is also associated with higher probabilities of workers leaving the labor force. This effect impacts mostly young and less educated people.