Economic Growth and Unemployment Nexus: Okun’s Two-Version Case for Nigeria, South Africa and United States of America

  • Adegbemi Babatunde Onakoya Department of Economics, Babcock University Ilishan-Remo Nigeria https://orcid.org/0000-0002-7583-5083
  • SEYINGBO, Adedotun Victor Tai Solarin University of Education, Ijagun, Nigeria
Keywords: Okun's Law, GDP growth, Unemployment rate, Difference version, Dynamic version

Abstract

Okun’s law in its original form was predicated on the experience in the United States of America. Some methodological refinements have been added based on studies conducted in other climes with varied results. This research investigated the applicability of this law in Nigeria, South Africa and the United States of America. The study conducted a comparative analysis of three of the versions of the law. The research employed Ordinary Least Squares method having validated it’s appropriateness with Dickey-Fuller and Philips-Perron tests. The demonstrated superiority of the dynamic version over the difference version was manifest in all the countries. The result also showed that the dynamic version of the law was applicable in the three nations while the difference version showed the lack of linkage between economic growth and unemployment only in Nigeria. Deployment of employment creative employment schemes, labour market reform and economic restructuring are recommended in the Nigerian case.  The policy makers on South Africa and USA are enjoined to pursue growth- inducing policies. 

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Published
2020-04-09
How to Cite
Onakoya, A. B., & Victor, S. A. (2020). Economic Growth and Unemployment Nexus: Okun’s Two-Version Case for Nigeria, South Africa and United States of America. Journal of Economics and Behavioral Studies, 12(1(J), 55-65. https://doi.org/10.22610/jebs.v12i1(J).3006
Section
Research Paper