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Examining the Unemployment Invariance Hypothesis: The Case of Australia
Author(s) -
Nguyen Van Phuong
Publication year - 2016
Publication title -
australian economic review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.308
H-Index - 29
eISSN - 1467-8462
pISSN - 0004-9018
DOI - 10.1111/1467-8462.12139
Subject(s) - unemployment , psychology , econometrics , economics , macroeconomics
This article examines the long‐run relationship between the unemployment rate and the labour force participation rate in Australia. Using cointegration analysis, I find that there is no long‐run relationship between these two variables in Australia. This finding supports the unemployment invariance hypothesis. The result is consistent with an empirical study of the United Kingdom but differs from the results in empirical studies for Sweden, the United States and Japan.