Convergence : The Journal of Economic Development
Vol.4 No.2 (2022)

Pembuktian Okun’s Law dalam Pertumbuhan Ekonomi di Indonesia

Pasaribu, Esti (Unknown)



Article Info

Publish Date
30 Dec 2022

Abstract

This study aims to investigate the impact of economic growth and inflation on unemployment in Indonesia over the period 1990-2021. Okun's Law states that there is a relationship between economic growth and unemployment, where the percentage increase in economic growth will be offset by a greater change in the unemployment rate. In other side, the classical Philips curve indicates a trade-off between inflation and unemployment. The data used in this study are secondary data of economic growth, unemployment rate, and inflation rate in Indonesia, obtained from Central Bureau of Statistics and Bank Indonesia website. The data was processed using the autoregressive distribution lag model (ARDL)  to obtain the regression coefficients. Aggregated data results show a negative relationship between economic growth and inflation to the unemployment rate. Thus, the authorities must focus on sustaining economic growth and inflation to reduce the unemployment rate in Indonesia.   Keywords :  Economic Growth1, Unemployment Rate2, Inflation 3

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Journal Info

Abbrev

convergence-jep

Publisher

Subject

Economics, Econometrics & Finance Environmental Science Social Sciences

Description

Convergence: The Journal of Economic Development is focused on publishing research articles in the field of economics, both theoretically and empirically covering development economics, macroeconomics, microeconomics, industrial economics, public economics, monetary economics, natural resource ...