Oil and Unemployment in Germany

21 Pages Posted: 17 Apr 2009

See all articles by Andreas Löschel

Andreas Löschel

University of Muenster - Chair of Microeconomics, esp. Energy and Resource Economics

Ulrich Oberndorfer

ZEW – Leibniz Centre for European Economic Research

Date Written: 2008

Abstract

In this paper, we analyze oil price impacts on unemployment for Germany. Firstly, we survey theoretical and empirical literature on the oil-unemployment relationship and relate them to the German case. Secondly, we illustrate this issue within the framework of a vector autoregression (VAR) approach for Germany. For this purpose, we use three different specifications in order to adequately address the uncertainty related to the construction of an adequate oil variable. Using monthly data from 1973 to 2008, we show that oil price increases induce a rise in unemployment in the German labor market. Moreover, for a restricted sample period for post-unification Germany, we oppose claims that the oil to macroeconomy relationship has weakened since the 1980s. However, our results suggest that it has become more important to construct adequate measures of oil price variables.

Keywords: oil price; unemployment; Germany

JEL Classification: Q43; E24

Suggested Citation

Löschel, Andreas and Oberndorfer, Ulrich, Oil and Unemployment in Germany (2008). ZEW - Centre for European Economic Research Discussion Paper No. 08-136, Available at SSRN: https://ssrn.com/abstract=1389455 or http://dx.doi.org/10.2139/ssrn.1389455

Andreas Löschel (Contact Author)

University of Muenster - Chair of Microeconomics, esp. Energy and Resource Economics ( email )

Universitätsstr. 14-16
48143 Munster
Germany

HOME PAGE: http://www.wiwi.uni-muenster.de/eroe

Ulrich Oberndorfer

ZEW – Leibniz Centre for European Economic Research ( email )

P.O. Box 10 34 43
L 7,1
D-68034 Mannheim, 68034
Germany

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
68
Abstract Views
743
rank
401,273
PlumX Metrics