Validity of Okun’s Law during the Financial Crisis of 2007 – Simulation of Structural Shock at the GDP Level of the European Union

Andrei GIURESCU Dumitru and Alexandru BODISLAV

Abstract:

Within this section we will analyze the evolution of the GDP growth rate correlated with the unemployment rate. The link between these two variables is called Okun's law, and the analysis will be conducted at the level of the European Union, the two indicators being taken as the averages of the aggregated values ​​of the EU member countries. The period for which the econometric model will be achieved is between the first quarter of 2000 and the first quarter of 2018.