Abstract

MOLERO OLIVA, Leobaldo Enrique; SALCEDO MUNOZ, Virgilio Eduardo; CAMPUZANO VASQUEZ, John Alexander  and  BEJARANO COPO, Holger Fabrizzio. ECONOMETRIC ANALYSIS OF UNEMPLOYMENT BEHAVIOR IN ECUADOR (SECOND QUARTER 2007 TO FOURTH QUARTER 2017). Tend. [online]. 2019, vol.20, n.2, pp.22-48. ISSN 0124-8693.  https://doi.org/10.22267/rtend.192002.119.

The objective of this paper is to provide an econometric analysis of the behavior of the unemployment rate of Ecuador in the period 2007: 2-2017: 4 with a quarterly frequency. The work uses Okun's Law as a theoretical approach to explain the behavior of the unemployment rate. The methodology consisted of an empirical strategy supported in the models of autoregressive distributed lags with cointegration according to the Pesaran and Shin approach. The results suggest that on average for each 1% of product growth there is a contemporary decrease in the unemployment rate of 0.30 percentage points, but there are also effects that persist in the following quarters. It is concluded that the reduction of the unemployment rate in Ecuador implies a political effort and the design of institutions in labor relations between workers and employers to boost the labor market.

JEL: E23, E24, C32.

Keywords : unemployment rate; Okun´s law; cointegration; labour market..

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