The Cyclicality of the Portuguese Labour Market: a Macroeconomic Perspective in the OECD Context


The portuguese labour market's cyclical fluctuations show little correlation with the aggregate business cycle as given by fluctuations in GDP per worker. Even though there are other OECD countries whose labour markets exhibit an equally tenuous relation with the business cycle as Portugal, the norm is a higher correlation. On the other hand, the Portuguese business cycle shows a degree of persistency, or temporal correlation, that ranks among the lowest in the OECD.This article argues that such facts have important implications for macroeconomics models of the labour market.

Bank of Portugal Economic Bulletin