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Mathematical modeling of the unemployment problem in a context of financial crisis

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  • Njike-Tchaptchet, Eric Rostand
  • Tadmon, Calvin

Abstract

In this paper, we formulate a new system of nonlinear ordinary differential equations to study the unemployment problem in a context of financial crisis. We first prove the existence of a unique positive equilibrium. Then, using an appropriate Lyapunov function under some specified conditions, we prove the global stability of the unique positive equilibrium. We also propose and compare two control strategies with the objective to improve, at the lowest cost, the employment rate. Our results suggest that, in order to reduce the unemployment rate, it is better for a government to assist unemployed people in building their own business which will allow them to further create new vacancies than to assist self-employed individuals to create new vacancies. Numerical simulations are presented to substantiate the theoretical results.

Suggested Citation

  • Njike-Tchaptchet, Eric Rostand & Tadmon, Calvin, 2023. "Mathematical modeling of the unemployment problem in a context of financial crisis," Mathematics and Computers in Simulation (MATCOM), Elsevier, vol. 211(C), pages 241-262.
    • Handle: RePEc:eee:matcom:v:211:y:2023:i:c:p:241-262
    DOI: 10.1016/j.matcom.2023.04.014
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    References listed on IDEAS

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    1. Eva Kaslik & Mihaela Neamţu & Loredana Flavia Vesa, 2021. "Global Stability Analysis of a Five-Dimensional Unemployment Model with Distributed Delay," Mathematics, MDPI, vol. 9(23), pages 1-15, November.
    2. H. A. Ashi & Raneah M. Al-Maalwi & Sarah Al-Sheikh, 2022. "Study of the unemployment problem by mathematical modeling: Predictions and controls," The Journal of Mathematical Sociology, Taylor & Francis Journals, vol. 46(3), pages 301-313, July.
    3. Liliana Harding & Mihaela Neamţu, 2018. "A Dynamic Model of Unemployment with Migration and Delayed Policy Intervention," Computational Economics, Springer;Society for Computational Economics, vol. 51(3), pages 427-462, March.
    4. Misbah Tanveer Choudhry & Enrico Marelli & Marcello Signorelli, 2012. "Youth unemployment rate and impact of financial crises," International Journal of Manpower, Emerald Group Publishing Limited, vol. 33(1), pages 76-95, March.
    5. Roger E.A. Farmer, 2013. "Animal Spirits, Financial Crises and Persistent Unemployment-super-," Economic Journal, Royal Economic Society, vol. 0, pages 317-340, May.
    6. Kaslik, Eva & Neamţu, Mihaela & Vesa, Loredana Flavia, 2021. "Global stability analysis of an unemployment model with distributed delay," Mathematics and Computers in Simulation (MATCOM), Elsevier, vol. 185(C), pages 535-546.
    7. Misbah Tanveer Choudhry & Enrico Marelli & Marcello Signorelli, 2012. "Youth unemployment rate and impact of financial crises," International Journal of Manpower, Emerald Group Publishing Limited, vol. 33(1), pages 76-95, March.
    8. Al-Maalwi, Raneah & Al-Sheikh, Sarah & Ashi, H.A. & Asiri, Sharefa, 2021. "Mathematical modeling and parameter estimation of unemployment with the impact of training programs," Mathematics and Computers in Simulation (MATCOM), Elsevier, vol. 182(C), pages 705-720.
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