Interactions between Economic Growth and Unemployment Condition in Asian Region

This study is aimed to examine the relationship between GDP growth and unemployment rate for developed and developing Asian countries over the period 1980-2010. This study has applied the Okun’s law framework to estimate the co-integration dynamic and weak or strong Granger-causality for relationship between GDP growth and unemployment rate with ARDL approach. The results found that developed and developing Asian countries have achieved the negative sign for the long run coefficient as well as the short run coefficient between Unemployment rate and GDP growth. Hence, some developed and developing Asian countries still robust in the theory Okun but the coefficient values are higher than original Okun’s law. Therefore, the new Okun’s framework in the Asian macroeconomics performance is being existed in the developed and developing Asian countries.