What are cyclical, frictional, and structural unemployment? The
natural rate of unemployment equals frictional plus structural
unemployment. Countries with higher unemployment insurance benefits
tend to have higher natural rates of unemployment. Do you think
that more generous unemployment benefits raise u* by reducing the
finding rate or increasing the separation rate?
2. For each, state whether the unemployment is structural,
frictional, seasonal or cyclical.
a. As the United States becomes a more high-tech producer,
labor-intensive factories no longer need as many workers
b. Unemployment rises as output in the economy slows.
c. Unemployment rate rises as the tourism months come to an
end.
d. As it becomes more acceptable for mothers to work, more women
enter the labor market looking for work. The unemployment rate
rises.
e. The demand for workers...
a) How would you classify unemployment caused by
an increase in unemployment insurance (Structural, Frictional, or
cyclical)?b) Would an increase in the number of unemployment
insurance suggest that it was becoming easier or more difficult for
people to find jobs? Explain.
1. How to distinguish between frictional, structural, and
cyclical unemployment? Why is unemployment an economic problem?
What are the social effects of unemployment?
2. Why do economists include only final goods and services when
measuring GDP for a particular year? Why don’t they include the
value of the stocks and bonds bought and sold? Why don’t they
include the value of the used furniture bought and sold?
3. Suppose that, on the basis of a nation’s production
possibilities curve, an...
How to distinguish between frictional, structural, and cyclical
unemployment? Why is unemployment an economic problem? What are the
social effects of unemployment?
a. Explain the meaning of structural, frictional, and cyclical
unemployment. b. Identify whether each of the following reflects
structural, frictional, or cyclical unemployment and also define
each of these unemployment.
i. A real estate agent is laid off due to slow business after
housing sales fall.
ii. An automotive worker is replaced by robotic equipment on the
assembly line.
iii. A salesperson quits a job in Ontario and seeks a new career
after moving to Alberta.
iv. An employee is...