Differences in Okun’s law between European regions

Notable What they owe? Differences in Okun’s law between European regions: Notable? What they owe Share on Twitter Share on Facebook Share on LinkedIn Compartment in Google Plus By Adolfo Maza, University of Cantabria The analysis of the validity of different economic laws has always been an important field of research within economic literature. Among them, one of the most studied is the so-called Okun’s law.  Which postulates an inverse relationship between variations in real gross domestic product (hereinafter GDP) and fluctuations in the unemployment rate. More specifically, the seminal work of Okun  leads to a decrease in the unemployment rate of approximately percentage points.

Since the aforementioned article

There has been a vast literature attempting to evaluate the validity/intensity of Okun’s law (see Porras Arena and Martín Román, 2023 , for a recent meta-analysis on this topic). Initially, and somewhat in line with the standard specification of Okun’s law restricted to aggregate  UK WhatsApp Number Data macroeconomic variables, most works addressed the study at the country level. However, there is an ongoing debate about whether to adopt a more general, multi-regional perspective, in which regions should be modeled as small self-sufficient  they have powers in many policy areas  that can be used to design policies that ultimately affect the labor market. one way or another.

In this context, and for the readers

This blog it is not very was methodological in nature; The model combined a heterogeneous panel  Cambodia WhatsApp Number List approach with cross-sectional dependence treatment. The methodology whose explanation of course has no place here. Us to obtain, together with an Okun coefficient for . Europe, a specific coefficient for each region. Finally, this work sought to improve our . Understanding of the relationship between GDP variations and unemployment by explaining in depth . The determinants of interregional differences. Model was  that to reveal the primary factors that could explain their differences.