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Alternative Methods of Estimating the Okun Coefficient. Applications for Romania

Author

Listed:
  • Caraiani, Petre

    (Institute for Economic Forecasting, Bucharest)

Abstract

The purpose of this study is to estimate the Okun coefficient for Romania for the 1991-2004 period. In order to derive it, I use a few alternative methods. As a dependent variable I use the gap of the unemployment rate while the independent variable is the gap of the production, where the aggregate production is approximated by the industrial production. I estimate the relationship through an ARDL model and through a bivariate structural VAR. The results indicate an Okun coefficient of about -0.17 which suggests some rigidity of the labor market.

Suggested Citation

  • Caraiani, Petre, 2006. "Alternative Methods of Estimating the Okun Coefficient. Applications for Romania," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 3(4), pages 82-89, December.
    • Handle: RePEc:rjr:romjef:v:3:y:2006:i:4:p:82-89
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    Citations

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    Cited by:

    1. KORI YAHIA, Abdellah, 2018. "Bayesian Linear Estimation of Okun Coefficient for Romania: Sensitivity to Priors," MPRA Paper 84140, University Library of Munich, Germany.
    2. Petre Caraiani, 2010. "Bayesian Linear Estimation of Okun Coefficient for Romania: Sensitivity to Priors Distributions," Romanian Economic Journal, Department of International Business and Economics from the Academy of Economic Studies Bucharest, vol. 13(38), pages 53-65, December.
    3. Mustafa Şit, 2024. "The Relationship Between Unemployment and Economic Growth in Selected Large Emerging Countries: A Revisit Using Threshold Regression Analysis," Journal of Economic Policy Researches, Istanbul University, Faculty of Economics, vol. 11(1), pages 76-85, January.
    4. Maria – Monica Haralambie & Bogdan Stefan Ionescu, 2017. "The economic implications of international migration – an analysis of capital remittances applied to Romania," The Audit Financiar journal, Chamber of Financial Auditors of Romania, vol. 15(148), pages 667-667.

    More about this item

    Keywords

    Business Cycles; Unemployment; Okun's Law;
    All these keywords.

    JEL classification:

    • E23 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Production
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles

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