View More View Less
  • 1 University of Information Technology and Management, Rzeszow, Poland
  • | 2 Warsaw School of Economics, Warsaw, Poland
Restricted access

Purchase article

USD  $25.00

1 year subscription (Individual Only)

USD  $700.00

We test whether the discouraged worker or added worker effect prevails in the Polish labour market. The discouraged worker effect implies that the participation rate is procyclical with respect to the GDP and countercyclical with respect to the unemployment rate. The added worker effect yields contrary findings. We analyse the period 1994–2014 with quarterly data. We focus on the working age population, both males and females. We apply a range of methods to obtain robust results, some of which have never been employed to resolve this problem. They include ad hoc filtration, spectral analysis, unobserved component model, time-varying parameter model, and frequency domain regression. The results indicate that the added worker effect prevails in most of the business cycle frequencies. It is significant and varies over time. It is true for both males and females. It is considerably stronger in contractions than in expansions. In low business cycle frequencies, the discouraged worker effect prevails. Although the last case is rare, it proves the heterogeneity of labour force behaviour over the business cycle.

  • Allison, C.Ringold, D. (1996): Labor Markets in Transition in Central and Eastern Europe 1989-1995. World Bank Technical Paper, 352. Washington, D.C.

    • Search Google Scholar
    • Export Citation
  • Benati, L. (2001): Some Empirical Evidence on the ‘Discouraged Worker’ Effect. Economics Letters, 70(3): 387395.

  • Central Statistical Office (2015): Aktywnosc ekonomiczna ludnosci Polski I kwartal 2015 r. (Labour Force Survey in Poland I Quarter 2015), http://stat.gov.pl/obszary-tematyczne/rynek-pracy/pracujacy-bezrobotni-bierni-zawodowo-wg-bael/aktywnosc-ekonomiczna-ludnosci-polskii- kwartal-2015-r-,4,16.html [access: 29.09.2015].

    • Search Google Scholar
    • Export Citation
  • Christiano, L. J.Fitzgerald, T. J. (2003): The Band Pass Filter. International Economic Review, 44(2): 435465.

  • Congregado, E.Carmona, M.Golpe, A. – van Stel, A. (2014): Unemployment, Gender and Labor Force Participation in Spain: Future Trends in Labor Market. Romanian Journal of Economic Forecasting, XVII 1): 5366.

    • Search Google Scholar
    • Export Citation
  • Congregado, E.Golpe, A. – van Stel, A. (2011): Exploring the Big Jump in the Spanish Unemployment Rate: Evidence on an ‘Added Worker Effect’. Economic Modelling, 28: 10991105.

    • Search Google Scholar
    • Export Citation
  • Durbin, J.Koompan, S. J. (2012): Time Series Analysis by State Space Methods. Oxford: Oxford University Press.

  • Duvvury, N.Finn, C. (2014): ‘Man-Covery’: Recession, Labour Market, and Gender Relations in Ireland. Gender, Sexuality and Feminism, 1(2): 5981.

    • Search Google Scholar
    • Export Citation
  • Englund, P.Persson, T.Svensson, L. (1992): Swedish Business Cycles: 1861–1988. Journal of Monetary Economics, 30(3): 343371.

    • Search Google Scholar
    • Export Citation
  • Filatriau, O.Reynes, F. (2012): A New Estimate of Discouraged and Additional Worker Effects on Labor Participation by Sex and Age in OECD Countries. OFCE Document de travail, 2012-09.

    • Search Google Scholar
    • Export Citation
  • Finegan, A. T. (1991): Discouraged Workers and Economic Fluctuations. Industrial and Labor Relations Review, 35(1): 88102.

  • Fuchs, J.Weber, E. (2013): A New Look at the Discouragement and the Added Worker Hypotheses: Applying a Trend-Cycle Decomposition to Unemployment. Applied Economic Letters, 20(15): 13741378.

    • Search Google Scholar
    • Export Citation
  • Galecka-Burdziak, E. (2011): Efekty discouraged workers, on-the-job search i out-of-labour force search na przykladzie polskiego rynku pracy (Discouraged Workers, On-the-Job Search and Out-of- Labour Force Search Effects on the Example of Polish Labour Market). In: Kotlorz, D. (ed.): Wspólczesny rynek pracy. Wybrane problemy (Contemporary Labour Market. Selected Problems). Katowice: Wydawnictwo Naukowe Uniwersytetu Ekonomicznego w Katowicach.

    • Search Google Scholar
    • Export Citation
  • Galecka-Burdziak, E. (2013): Mechanisms of Labour Market Matching of Job Seekers and Vacancies. Unpublished PhD thesis. Warsaw: Warsaw School of Economics.

    • Search Google Scholar
    • Export Citation
  • Galecka-Burdziak, E. (2015): Rezerwa sily roboczej? Aktywnosc ekonomiczna w Polsce (Reserve Labour Force? Labour Market Activity in Poland). Polityka Spoleczna, 42(2): 59.

    • Search Google Scholar
    • Export Citation
  • Gong, X. (2010): The Added Worker Effect and the Discouraged Worker Effect for Married Women in Australia. IZA Working Paper, 4816.

  • Góra, M. (2005): Trwale wysokie bezrobocie w Polsce. Wyjasnienia i propozycje (Persistency of High Unemployment in Poland. Reflections, Analytical Considerations and Some Suggestions). Ekonomista, 1: 2748.

    • Search Google Scholar
    • Export Citation
  • Harvey, A. C. (1975): Spectral Analysis in Economics. The Statistician, 24(1): 136.

  • Harvey, A. C. (1989): Forecasting Structural Time Series Models and the Kalman Filter. Cambridge: Cambridge University Press.

  • Hassler, J.Lundvik, P.Persson, T.Söderlind, P. (1994): The Swedish Business Cycle: Stylized Facts over 130 Years. In: Bergström, V.Vredin, A. (eds): Measuring and Interpreting Business Cycles. Oxford: Oxford University Press.

    • Search Google Scholar
    • Export Citation
  • Hodrick, R. J.Prescott, E. C. (1997): Postwar U.S. Business Cycles: An Empirical Investigation. Journal of Money, Credit and Banking, 29(1): 116.

    • Search Google Scholar
    • Export Citation
  • Kucharski, L. (2002): Przeplywy sily roboczej w Polsce w latach dziewiecdziesiatych (Labour Force Flows in Poland during 1990s). Lódz: Katedra Ekonomii Uniwersytetu Lódzkiego.

    • Search Google Scholar
    • Export Citation
  • Lee, G.Parasnis J. (2014): Discouraged Workers in Developed Countries and Added Workers in Developing Countires? Unemployment Rate and Labour Force Participation. Economic Modelling, 41: 9098.

    • Search Google Scholar
    • Export Citation
  • Lundberg, S. (1985): The Added Worker Effect. Journal of Labor Economics, 3(1): 1137.

  • Martin Roman, A. – Moral del Blas, A. (2002): Oferta de trabajo y desempleo en Europa: el caso de las mujeres (Job Offers and Unemployment in Europe: The Case of Women). Revista de Estudios Europeos, 30: 2341.

    • Search Google Scholar
    • Export Citation
  • McConnell, C.Brue, S.MacPherson, D. (2006): Contemporary Labor Economics. New York: McGrow-Hill Irwin.

  • O’Brien, M. (2011): Discouraged Older Male Workers and the Discouraged Worker Effect. Australian Journal of Labour Economics, 14(3): 217235.

    • Search Google Scholar
    • Export Citation
  • Pater, R. (2014): Are There Two Types of Business Cycles? A Note on Crisis Detection. e-Finanse, 10(3): 128.

  • Tomic, I. (2014): Regional Matching (In)efficiency on the Croatian Labour Market. Acta Oeconomica, 64(3): 287312.

  • Zarnowitz, V.Ozyildirim, A. (2006): Time Series Decomposition and Measurement of Business Cycles, Trends and Growth Cycles. Journal of Monetary Economics, 53(7): 17171739.

    • Search Google Scholar
    • Export Citation