Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/55312
Authors: 
Caporale, Guglielmo Maria
Škare, Marinko
Year of Publication: 
2011
Series/Report no.: 
DIW Discussion Papers 1138
Abstract: 
In this paper we analyse the short- and long-run relationship between employment growth, inflation and output growth in Phillips' tradition. For this purpose we apply FMOLS, DOLS, PMGE, MGE, DFE, and VECM methods to a nonstationary heterogeneous dynamic panel including annual data for 119 countries over the period 1970-2010, and also carry out multivariate Granger causality tests. The empirical results strongly support the existence of a single cointegrating relationship between employment growth, inflation and output growth with bidirectional causality between employment growth and inflation as well as output growth, giving support to Phillips' Golden Triangle theory.
Subjects: 
employment growth
inflation
output growth
Golden Triangle theory
JEL: 
C23
E24
E31
E60
Document Type: 
Working Paper

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