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DO INFLATION AND ECONOMIC GROWTH SUBSTANTIALLY AFFECT YOUTH UNEMPLOYMENT? EVIDENCE FROM 20 EMERGING ECONOMIES

Year 2018, 18. EYI Special Issue, 55 - 66, 16.01.2018
https://doi.org/10.18092/ulikidince.354678

Abstract

The main objective of this paper is to discuss how
inflation and economic growth affects youth unemployment in emerging economies.
Within this study, the effect of inflation and economic growth on youth
unemployment was tested for 20 emerging economies (Brazil, Chile, China,
Colombia, Czech Republic, Egypt, Greece, Hungary, India, Indonesia, Malaysia,
Mexico, Pakistan, Peru, Philippines, Poland, Russia Federation, South Africa,
Thailand, Turkey) with the data covering the period of 1991–2016. The
relationship between the variables was tested via second generation panel
cointegration and panel causality tests. According to the findings of
Durbin-Hausman panel cointegration test by Westerlund (2008), there is a
cointegration relationship between variables. In addition, Dumitrescu-Hurlin
(2012) panel causality test results have indicated that there exists
statistically significant bidirectional causality between inflation and youth
unemployment and also between economic growth and youth unemployment. Based on
these results, it is possible to say that inflation and economic growth
substantially affect youth unemployment and the direction of the effect is
negative on youth unemployment. That means positive developments in inflation
and economic growth lead to a decline in youth unemployment rates for selected
emerging economies.

References

  • Ahmad, R. and Azım, P. (2010). Youth Population and The Labour Market of Pakistan: A Micro Lev-el Study. Pakistan Economic and Social Review, 48(2), 183-208.
  • Ar, K. N. (2014). Youth Unemployment in 21st Century: The Turkish Case. Paper presented at Inter-national Conference on Eurasian Economies. Erişim Adresi http://avekon.org/papers/1081.pdf
  • Assaad, R. and Krafft, C. (2016). Labour Market Dynamics and Youth Unemployment in the Middle East and North Africa: Evidence from Egypt, Jordan and Tunisia. Economic Research Forum Working Paper Series. 993.
  • Bernal-Verdugo, L., Furceri, D. and Guillaume, D. (2012). Crises, Labor Market Policy, and Unem-ployment. IMF Working Paper. 1(65).
  • Breusch, T. S. and Pagan, A. R. (1980). The Lagrange Multiplier Test and Its Applications to Model Specification in Econometrics. The Review of Economic Studies, 47(1), 239-253.
  • Chinweuba, T. E. (2015). Relative Impact of Inflation and Unemployment on Economic Growth in Nigeria (1980-2013). Advances in Social Sciences Research Journal, 2(7), 27-44.
  • Cloete, A. (2015). Youth Unemployment in South Africa, A Theological Reflection Through the Lens of Human Dignity. Missionalia, 43(3), 513–525.
  • Çondur, F. and Bölükbaş, M. (2014). Türkiye’de İşgücü Piyasası ve Genç İşsizlik-Büyüme İlişkisi Üzerine Bir İnceleme. Amme İdaresi Dergisi, 47(2), 77-93.
  • Dumitrescu, E. I., and Hurlin, C. (2012). Testing for Granger Non-causality in Heterogeneous Panels. Economic Modelling, 29(4), 1450-1460.
  • Eichhorst, W. and Neder, F. (2014). Youth Unemployment in Mediterranean Countries. IZA Policy Paper, 80.
  • El-hamidi, F. and Wahba, J. (2005). The Effects of Structural Adjustment on Youth Unemployment in Egypt. Paper presented at 12th Annual Conference of the Economic Research Forum (La-bor Research Theme). Erişim Adresi http://d-scholarship.pitt.edu/5760/
  • Embareka, A. (2011). The Impact of Labor Market Trends on Unemployment Rates in Egypt Using Time Series Analysis Model. Paper presented at 58th World Statistical Congress, Dublin. Erişim Adresi http://2011.isiproceedings.org/papers/950728.pdf
  • Ibrahim, D. H. M. and Mahyuddin, M. Z. (2017). Youth Unemployment in Malaysia: Developments and Policy Considerations. Outlook and Policy, Annual Report.
  • ILO (2016). World Employment and Social Outlook 2016: Trends for Youth. International Labour Office. Geneva. Erişim Adresi http://www.ilo.org/global/about-the-ilo/newsroom/news/WCMS_513728/lang--ja/index.htm
  • ILO (2013). Global Employment Trends for Youth 2013: A Generation at Risk. International Labour Office, Geneva. Erişim Adresi http://www.ilo.org/wcmsp5/groups/public/@dgreports/@dcomm/documents/publication/wcms_212423.pdf
  • Li, X. (2009). Factors Affect the Employment of Youth in China. Växjö University School of Man-agement and Economics Bachelor Thesis, Sweden.
  • OECD (2013). The OECD Action Plan for Youth – Giving Youth a Better Start in the Labour Market, Meeting of the OECD Council at Ministerial Level, Paris. Erişim Adresi https://www.oecd.org/els/emp/Youth-Action-Plan.pdf
  • Pesaran, M. H. and Smith, R. (1995). Estimating Long-run Relationships from Dynamic Heterogene-ous Panels. Journal of Econometrics, 68(1), 79-113.
  • Pesaran, M. H., Shin, Y. and Smith, R. (1999). Pooled Mean Group Estimation of Dynamic Heteroge-neous Panel. Journal of American Statistical Association, 94, 621-634.
  • Pesaran, M. H. (2004). General Diagnostic Tests for Cross Section Dependence in Panels. Cam-bridge Working Papers in Economics (CWPE), 0435.
  • Pesaran, M. H. (2007). A Simple Panel Unit Root Test in the Presence of Cross Section Depend-ence. Journal of Applied Econometrics, 22(2), 265-312.
  • Pesaran, M. H., Ullah, A. and Yamagata, T. (2008). A Bias-Adjusted LM Test of Error Cross-Section Independence. Econometrics Journal, 11(1), 102-127.
  • Pesaran, M. H., and Yamagata, T. (2008). Testing Slope Homogeneity in Large Panels. Journal of Econometrics, 142(1), 50-93.
  • Qayyum, W. (2007). Causes of Youth Unemployment in Pakistan. The Pakistan Development Re-view, 46(4), 611–621.
  • Tatoğlu, Y. F. (2012). İleri Panel Veri Analizi Stata Uygulamalı, Istanbul: Beta Yayınevi,
  • Umaru, A. and Zubairu, A. (2012). An Empirical Analysis of the Relationship Between Unemploy-ment and Inflation in Nigeria from 1977-2009. Economics and Finance Review, 1(12), 42–61.
  • Umaru, A. (2014). Effects of Unemployment and Inflation on Economic Growth in Nigeria, 1986-2012. Ahmadu Bello University, Faculty of Social Science Department of Economics, Mas-ter Thesis.
  • Venatus, V. K. and Agnes, I. (2010). Youth Unemployment in Nigeria: Causes and Related Issues. Canadian Social Science, 6(4), 231-237.
  • Vermeulen, C. (2015). Inflation, Growth and Employment in South Africa: Trends and Trade-offs. Economic Research Southern Africa (ERSA) Working Paper, 547.
  • Westerlund, J. (2008). Panel Cointegration Tests of the Fisher Effect. Journal of Applied Economet-rics, 23(2), 193-233.
  • World Bank (2017). World Bank Open Data. Erişim Adtresi https://data.worldbank.org/
  • Yu, D. (2013). Youth Unemployment in South Africa Since 2000 Revisited. Stellenbosch Economic Working Papers, 04(13).

DO INFLATION AND ECONOMIC GROWTH SUBSTANTIALLY AFFECT YOUTH UNEMPLOYMENT? EVIDENCE FROM 20 EMERGING ECONOMIES

Year 2018, 18. EYI Special Issue, 55 - 66, 16.01.2018
https://doi.org/10.18092/ulikidince.354678

Abstract

Bu
çalışmanın temel amacı gelişmekte olan ekonomilerde enflasyon ve ekonomik
büyümenin genç işsizliği nasıl etkilediğini tartışmaktır. Bu bağlamda çalışmada
enflasyon ve ekonomik büyümenin genç işsizlik üzerindeki etkisi 1991-2016
dönemi dikkate alınarak 20 gelişmekte olan ülke (Brezilya, Çek Cumhuriyeti,
Çin, Filipinler, Endonezya, Güney Afrika, Hindistan, Kolombiya, Macaristan,
Malezya, Meksika, Mısır, Pakistan, Peru, Polonya, Rusya, Şili, Tayland, Türkiye
ve Yunanistan) için test edilmiştir. Değişkenler arasındaki ilişki ikinci nesil
panel eşbütünleşme ve panel nedensellik testleriyle araştırılmıştır. Westerlund
(2008) tarafından geliştirilen Durbin-Hausman panel eşbütünleşme test
sonuçlarına göre, değişkenler arasında bir eşbütünleşme ilişkisi tespit
edilmiştir. Bununla birlikte, Durbin-Hausman (2012) panel nedensellik test
sonuçları, hem enflasyon ile genç işsizlik arasında, hem de ekonomik büyüme ile
genç işsizlik arasında istatistik olarak anlamlı olan iki yönlü nedensellik
ilişkisi bulunduğunu göstermektedir. Bu sonuçlara dayanarak enflasyonun ve
ekonomik büyümenin genç işsizliği gerçek anlamda etkilediği ve bu etkinin
negatif yönde olduğu söylenebilmektedir. Bunun anlamı ise çalışma kapsamındaki
gelişmekte olan ülkelerde enflasyonda ve ekonomik büyümede meydana gelecek
pozitif gelişmelerin genç işsizliği azaltmada etkili olduğudur. 

References

  • Ahmad, R. and Azım, P. (2010). Youth Population and The Labour Market of Pakistan: A Micro Lev-el Study. Pakistan Economic and Social Review, 48(2), 183-208.
  • Ar, K. N. (2014). Youth Unemployment in 21st Century: The Turkish Case. Paper presented at Inter-national Conference on Eurasian Economies. Erişim Adresi http://avekon.org/papers/1081.pdf
  • Assaad, R. and Krafft, C. (2016). Labour Market Dynamics and Youth Unemployment in the Middle East and North Africa: Evidence from Egypt, Jordan and Tunisia. Economic Research Forum Working Paper Series. 993.
  • Bernal-Verdugo, L., Furceri, D. and Guillaume, D. (2012). Crises, Labor Market Policy, and Unem-ployment. IMF Working Paper. 1(65).
  • Breusch, T. S. and Pagan, A. R. (1980). The Lagrange Multiplier Test and Its Applications to Model Specification in Econometrics. The Review of Economic Studies, 47(1), 239-253.
  • Chinweuba, T. E. (2015). Relative Impact of Inflation and Unemployment on Economic Growth in Nigeria (1980-2013). Advances in Social Sciences Research Journal, 2(7), 27-44.
  • Cloete, A. (2015). Youth Unemployment in South Africa, A Theological Reflection Through the Lens of Human Dignity. Missionalia, 43(3), 513–525.
  • Çondur, F. and Bölükbaş, M. (2014). Türkiye’de İşgücü Piyasası ve Genç İşsizlik-Büyüme İlişkisi Üzerine Bir İnceleme. Amme İdaresi Dergisi, 47(2), 77-93.
  • Dumitrescu, E. I., and Hurlin, C. (2012). Testing for Granger Non-causality in Heterogeneous Panels. Economic Modelling, 29(4), 1450-1460.
  • Eichhorst, W. and Neder, F. (2014). Youth Unemployment in Mediterranean Countries. IZA Policy Paper, 80.
  • El-hamidi, F. and Wahba, J. (2005). The Effects of Structural Adjustment on Youth Unemployment in Egypt. Paper presented at 12th Annual Conference of the Economic Research Forum (La-bor Research Theme). Erişim Adresi http://d-scholarship.pitt.edu/5760/
  • Embareka, A. (2011). The Impact of Labor Market Trends on Unemployment Rates in Egypt Using Time Series Analysis Model. Paper presented at 58th World Statistical Congress, Dublin. Erişim Adresi http://2011.isiproceedings.org/papers/950728.pdf
  • Ibrahim, D. H. M. and Mahyuddin, M. Z. (2017). Youth Unemployment in Malaysia: Developments and Policy Considerations. Outlook and Policy, Annual Report.
  • ILO (2016). World Employment and Social Outlook 2016: Trends for Youth. International Labour Office. Geneva. Erişim Adresi http://www.ilo.org/global/about-the-ilo/newsroom/news/WCMS_513728/lang--ja/index.htm
  • ILO (2013). Global Employment Trends for Youth 2013: A Generation at Risk. International Labour Office, Geneva. Erişim Adresi http://www.ilo.org/wcmsp5/groups/public/@dgreports/@dcomm/documents/publication/wcms_212423.pdf
  • Li, X. (2009). Factors Affect the Employment of Youth in China. Växjö University School of Man-agement and Economics Bachelor Thesis, Sweden.
  • OECD (2013). The OECD Action Plan for Youth – Giving Youth a Better Start in the Labour Market, Meeting of the OECD Council at Ministerial Level, Paris. Erişim Adresi https://www.oecd.org/els/emp/Youth-Action-Plan.pdf
  • Pesaran, M. H. and Smith, R. (1995). Estimating Long-run Relationships from Dynamic Heterogene-ous Panels. Journal of Econometrics, 68(1), 79-113.
  • Pesaran, M. H., Shin, Y. and Smith, R. (1999). Pooled Mean Group Estimation of Dynamic Heteroge-neous Panel. Journal of American Statistical Association, 94, 621-634.
  • Pesaran, M. H. (2004). General Diagnostic Tests for Cross Section Dependence in Panels. Cam-bridge Working Papers in Economics (CWPE), 0435.
  • Pesaran, M. H. (2007). A Simple Panel Unit Root Test in the Presence of Cross Section Depend-ence. Journal of Applied Econometrics, 22(2), 265-312.
  • Pesaran, M. H., Ullah, A. and Yamagata, T. (2008). A Bias-Adjusted LM Test of Error Cross-Section Independence. Econometrics Journal, 11(1), 102-127.
  • Pesaran, M. H., and Yamagata, T. (2008). Testing Slope Homogeneity in Large Panels. Journal of Econometrics, 142(1), 50-93.
  • Qayyum, W. (2007). Causes of Youth Unemployment in Pakistan. The Pakistan Development Re-view, 46(4), 611–621.
  • Tatoğlu, Y. F. (2012). İleri Panel Veri Analizi Stata Uygulamalı, Istanbul: Beta Yayınevi,
  • Umaru, A. and Zubairu, A. (2012). An Empirical Analysis of the Relationship Between Unemploy-ment and Inflation in Nigeria from 1977-2009. Economics and Finance Review, 1(12), 42–61.
  • Umaru, A. (2014). Effects of Unemployment and Inflation on Economic Growth in Nigeria, 1986-2012. Ahmadu Bello University, Faculty of Social Science Department of Economics, Mas-ter Thesis.
  • Venatus, V. K. and Agnes, I. (2010). Youth Unemployment in Nigeria: Causes and Related Issues. Canadian Social Science, 6(4), 231-237.
  • Vermeulen, C. (2015). Inflation, Growth and Employment in South Africa: Trends and Trade-offs. Economic Research Southern Africa (ERSA) Working Paper, 547.
  • Westerlund, J. (2008). Panel Cointegration Tests of the Fisher Effect. Journal of Applied Economet-rics, 23(2), 193-233.
  • World Bank (2017). World Bank Open Data. Erişim Adtresi https://data.worldbank.org/
  • Yu, D. (2013). Youth Unemployment in South Africa Since 2000 Revisited. Stellenbosch Economic Working Papers, 04(13).
There are 32 citations in total.

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Journal Section Articles
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Mehmet Bölükbaş 0000-0002-9770-069X

Publication Date January 16, 2018
Published in Issue Year 2018 18. EYI Special Issue

Cite

APA Bölükbaş, M. (2018). DO INFLATION AND ECONOMIC GROWTH SUBSTANTIALLY AFFECT YOUTH UNEMPLOYMENT? EVIDENCE FROM 20 EMERGING ECONOMIES. Uluslararası İktisadi Ve İdari İncelemeler Dergisi55-66. https://doi.org/10.18092/ulikidince.354678

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