Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/201800 
Authors: 
Year of Publication: 
2019
Series/Report no.: 
Discussion Paper No. 411
Publisher: 
European University Viadrina, Department of Business Administration and Economics, Frankfurt (Oder)
Abstract: 
This paper estimates Okun's law in the EU15 countries between 1980 and 2018. It employs three different versions of the law with a focus on the dynamic part of the relationship. We find that the negative relationship between unemployment and output holds for most countries and is fairly stable over time. However, Okun's coefficient varies substantially across countries. The dynamic version can shed light on the different country estimates found in the literature and is useful to assess the stability of the law. The paper argues that lag effects need to be taken into account to avoid possible misspecification of the short run unemployment-output relationship. A mixed lag structure indirectly controls for missing explanatory variables and includes possible asymmetries.
Subjects: 
Okun's law
unemployment
growth
dynamic modelling
cycles
JEL: 
E24
C22
E32
Document Type: 
Working Paper

Files in This Item:
File
Size
439.63 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.