Oil shocks and unemployment dynamics in Alaska: The source of shocks matters

Our investigation presents a thorough analysis of how oil supply and two types of demand-side shocks-aggregate demand and oil-specific demand-affect unemployment in Alaska. We consider both symmetric and asymmetric contexts to provide a comprehensive perspective. Our findings reveal the substantial influence of both oil supply and oil-specific demand shocks on Alaska's unemployment, impacting both short and long-term dynamics. However, the impact of aggregate demand shocks is pronounced in the short run but diminishes in the long run. Further, we identify asymmetric effects in the long run for oil-specific demand shocks and in the short run for aggregate demand shocks. Intriguingly, our analysis does not uncover any evidence of asymmetric effects resulting from oil supply shocks in either the short or long term.