Historical Patterns, Okun’s Law, and the Great Recession

Arin Dube shows that estimates of Okun’s law are inconsistent with the assertion that most of the unemployment problem is structural rather than cyclical:

Historical Patterns, Okun’s Law, and the Great Recession, by Arin Dube: After reading Paul Krugman’s post today, I decided to follow up by actually estimating out-of-sample unemployment rate change forecasts during the Great Recession based on a pre-2007 Okun’s law relationship (i.e., a regression of change in the unemployment rate on percentage change in real GDP).

This anchors the previous post.

Where are we?

July 9, 2011

This is the real issue. and politics is being used to keep the results where they are. But the good of the country as a just society – and a productive one – requires that the tide reverse and reverse the narrowing into a broadening of wealth holding and income possibilities. big task. But it must be done.

Some think this. Alternative views:

1. elites always win so nothing new.
2. finance is key to the economy so we need to allow it its prerogatives.

Where is economics entering this discussion?