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This post was written by Prof. H. D. Vinod. Fordham University, New York.
A Chicago professor Luigi Zingales recently reported on Bloomberg that had Romney been the president for the last four years, US would have had a different labor market. In particular it is alleged that Obama increased the uncertainty and instilled disincentives for hiring.
I had already worked on a similar problem for the benefit of my Ph.D. students in econometrics. I use R to test similar hypotheses about distinct labor markets under George W. Bush and Obama.
Although it is impossible to directly study disincentives, we can look at their practical consequences. Indeed the conservative Chicago claims appear to be supported by the data. Liberals are invited to re-do my reproducible analysis since I provide all data and my R code.
In particular, the “elasticity of substitution” between unemployment rate and job vacancy rate is quite different for Obama and Bush. I urge the readers to read my paper which uses R and Sweave allowing my results to be completely transparent and reproducible for skeptical readers. My paper is entitled “Unemployment Reduction Prowess Under Bush versus Obama Years”. The pdf file of the paper provides my R code (in red font) with output in blue font along with full explanation of concepts with figures using Latex based pdf file is freely available at The social science research network http://ssrn.com/abstract=2149316
The source code is available here: Bush_r_code