PL EN
Empirical Analysis of the Phillips Curve and Okun’s Law Through Simultaneous Equation Modeling: A Case Study of Pakistan.
 
Więcej
Ukryj
 
Data publikacji: 15-06-2021
 
 
Ekonomista 2021;(3):418-439
 
SŁOWA KLUCZOWE
KODY KLASYFIKACJI JEL
E41
E42
 
STRESZCZENIE
According to the Phillips curve, there is an inverse relationship between inflation and unemployment. According to the Okun’s law, there is an inverse relationship between potential output growth and unemployment. The paper tries to check whether these interdependencies are seen in the Pakistan’s economy, thus testing the relevance of both dependencies for that economy. With this aim, the authors analyse the relationships between several macroeconomic variables, such as inflation rate, unemployment rate, GDP per capita growth rate, and population growth rate, using annual data of the period 1985–2017. By employing the respective simultaneous equation models (SEM) estimated with the indirect least square technique (ILS) and using various statistical tests, the authors conclude that the relationship postulated by the Phillips curve can be observed in the Pakistan’s economy, but the results of the examination do not confirm the occurrence of the relationship postulated by the Okun’s law.
eISSN:2299-6184
ISSN:0013-3205
Journals System - logo
Scroll to top