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Treball Final de Grau en Economia. Codi: EC1049. Curs acadèmic: 2021/2022 This paper estimates Okun’s law in the G7 countries and Spain between 1971 and 2020. It employs different specifications of the model, focusing on the dynamic part of the relationship. I find that the negative relationship between output and unemployment generally holds over the selected time period. Nevertheless, Okun’s coefficient varies significantly across countries. The dynamic version can enlighten the different country estimations that can be found in the literature. Time lags are used to avoid any possible misspecification. Several regressions and tests are conducted to account for unit roots, auto-correlation and structural breaks. |
