Lee Ohanian, Andrea Raffo, 16 October 2011

During the Great Recession, output in the US fell slightly less than in Germany while total hours worked fell nearly 8% in the US but only 1% in Germany. This column constructs a new dataset for total hours worked per quarter for the last 50 years in 14 OECD countries to check whether these patterns are consistent with previous historical episodes. It then suggests the labour-market weakness in the US may be fundamentally tied to the large decline in housing.

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