An Empirical Analyses of Unemployment Hysteresis and Natural Rate of Unemployment Approaches for MENA Countries

Abstract

This paper aims to test natural rate of unemployment and approach of unemployment hysteresis in MENA*** countries for the period of 1991-2014 by using panel data analysis methods which considering the cross-sectional dependency properties. Cross-sectional dependency test results indicate that there is cross-section dependency among all variables. According to CADF test results, unemployment rates in all countries have unit root. According to the CIPS test results, unemployment rates in MENA countries has unit root. In this context, all the impact of a shock can be seen on the unemployment rate in the mentioned region is permanent. Therefore; it can be said that the current approach of unemployment hysteresis in the region countries are valid.

Keywords

• Natural Unemployment
• Unemployment Hysteresis; MENA Countries; Panel Data Unit Root Analysis
• Unemployment Hysteresis
• MENA Countries
• Panel Data Unit Root Analysis