Welcome to the InfoSci Platform
Reference Hub7
Unemployment and its Impact on Economic Growth in the European Union: An Evidence from Panel Data Analysis

Unemployment and its Impact on Economic Growth in the European Union: An Evidence from Panel Data Analysis

Murat Cetin, Davuthan Gunaydın, Hakan Cavlak, Birol Topcu
Copyright: © 2015 |Pages: 11
ISBN13: 9781466673083|ISBN10: 1466673087|EISBN13: 9781466673090
DOI: 10.4018/978-1-4666-7308-3.ch002
Cite Chapter Cite Chapter

MLA

Cetin, Murat, et al. "Unemployment and its Impact on Economic Growth in the European Union: An Evidence from Panel Data Analysis." Regional Economic Integration and the Global Financial System, edited by Engin Sorhun, et al., IGI Global, 2015, pp. 12-22. https://doi.org/10.4018/978-1-4666-7308-3.ch002

APA

Cetin, M., Gunaydın, D., Cavlak, H., & Topcu, B. (2015). Unemployment and its Impact on Economic Growth in the European Union: An Evidence from Panel Data Analysis. In E. Sorhun, Ü. Hacıoğlu, & H. Dinçer (Eds.), Regional Economic Integration and the Global Financial System (pp. 12-22). IGI Global. https://doi.org/10.4018/978-1-4666-7308-3.ch002

Chicago

Cetin, Murat, et al. "Unemployment and its Impact on Economic Growth in the European Union: An Evidence from Panel Data Analysis." In Regional Economic Integration and the Global Financial System, edited by Engin Sorhun, Ümit Hacıoğlu, and Hasan Dinçer, 12-22. Hershey, PA: IGI Global, 2015. https://doi.org/10.4018/978-1-4666-7308-3.ch002

Export Reference

Mendeley
Favorite

Abstract

Unemployment has become an increasingly serious economic and social problem in many European countries. Theoretically, unemployment has a negative effect on economic growth and development. This chapter examines the impact of unemployment on economic growth in 15 EU countries from 1984 to 2012 by using several panel data techniques. Panel unit root tests suggest that the series employed in the study are stationary at first differences. In other words, the series are integrated of order one, I(1). Panel cointegration tests show that the variables are cointegrated over the period implying a long-run relationship between the variables. Panel OLS estimations show that the impact of unemployment on economic growth is negative and statistically significant. This indicates that unemployment decreases economic growth in these countries. Finally, Granger causality tests based on vector error correction model suggest that there is a bi-directional causality between the variables in the short and long run. The findings may provide some policy implications.

Request Access

You do not own this content. Please login to recommend this title to your institution's librarian or purchase it from the IGI Global bookstore.