FACTORS INFLUENCING THE UNEMPLOYMENT RATE IN ROMANIA DURING 1997-2019

Daniela-Georgeta BEJU; Ioan-Alin NISTOR; Maria-Lenuţa CIUPAC-ULICI

doi:10.24193/subbnegotia.2020.4.03

Authors

Daniela-Georgeta BEJU ssociate Professor PhD, Department of Finance, Faculty of Economics and Business Administration, Babeș-Bolyai University Cluj-Napoca, Romania; daniela.beju@ubbcluj.ro https://orcid.org/0000-0002-1789-5248
Ioan-Alin NISTOR Associate Professor PhD, Faculty of Business, Babeș-Bolyai University Cluj-Napoca, Romania; ioan.nistor@ubbcluj.ro https://orcid.org/0000-0003-3756-9316
Maria-Lenuţa CIUPAC-ULICI Lecturer PhD, Department of Finance, Faculty of Economic Sciences, Hyperion University Bucharest, Romania; maria.ulici.ciupac@gmail.com

DOI:

https://doi.org/10.24193/subbnegotia.2020.4.03

Keywords:

unemployment rate, exchange rate, inflation rate.

Abstract

Current macroeconomic theories examine the problem of unemployment rate from the aggregate demand point of view. Rising unemployment is always seen as a sign of the weak economy, where is a slow growth and also little spending. These might trigger actions by authorities to help reduce unemployment, by increasing the nation's money supply, so it can boost the economy. Among the factors that influence (un-)employment, at least two very important should be taken in consideration: exchange rate and inflation. The research aims to analyse the impact of inflation, the RON / EURO exchange rate and the financial crisis on unemployment rate in Romania during January 1997- March 2019.

JEL Codes: E24, F31, E31

References

Adebowale, K.B. (2015), The Relationship between Inflation and Unemployment in Nigeria, Working Paper, Eastern Mediterranean University, Gazimağusa, North Cyprus

Animu, U., A., & Abdulrahaman, Z. (2012). An Empirical Analysis of the Relationship between Unemployment and Inflation in Nigeria for the Period 1977-2009, 20(47), 0401

Bakhshi, Z. and Ebrahimi, M. (2016), The effect of real exchange rate on unemployment, Marketing and Branding Research, issue 3, pp. 4-13

Bessinger T. and Möller J. (2000), Unemployment: Theoretical explanations, in Globalization and Unemployment, Helmut Wagner (ed.), Springer-Verlag Berlin Heidelberg 2000, pp. 89-133

Belke A. and Gros D. (2000), Effects of European Monetary Integration on Unemployment: How Costly Was (Intra-European) Exchange Rate Variability? in Globalization and Unemployment, Helmut Wagner (ed.), Springer-Verlag Berlin Heidelberg 2000, pp. 203-242

Chang, S. C. (2011). The interrelationship between exchange-rate uncertainty and unemployment for South Korea and Taiwan: Evidence from a vector autoregressive approach. International Economics, 125, 65–82

Chimanani, H., Bhutto, N. A., Butt, F., Sheikh, S. A., & Devi, W. (2012). The effect of exchange rate on unemployment rate in Asian countries. Proceedings of 2nd International Conference on Business Management

Chimnani H., Bhutto N. A., Butt F., Shaikh S. A., Devi A. (2012), The Effect of Exchange Rate on Unemployment Rate in Asian Countries, Proceedings of 2nd International Conference on Business Management, 28-29 March 2012, University of management and Technology, Lahore, Punjab, Pakistan, pp. 2-16

Djivre, J. & Ribon, S. (2000, June). Inflation, unemployment, the Exchange Rate and Monetary Policy in Israel 1990-1999: A SVAR Approach. Paper presented at the meeting of Bank of Israel, Research Department, Jerusalem, Israel

Feldmann, H. (2011). The unemployment effect of exchange rate volatility in industrial countries. Economic letters, 111(3), 268–271

Frenkel, R. (2006). Real exchange rate and employment in Argentina, Brazil, Chile and Mexico. Iktisat Isletme ve Finans, 19(223), 29–52

Frenkel, R., & Ros, J. (2006). Unemployment and the real exchange rate in Latin America. World Development, 34(4), 631–646

Friedman M. (1968), The Role of Monetary Policy, The American Economic Review, Volume LVIII, March 1968, Number 1, pp. 1-17

Goldstein M. (1972), The Trade-off between Inflation and Unemployment: A Survey of the Econometric Evidence for Selected Countries, Staff Papers (International Monetary Fund), Vol. 19, No. 3 (Nov. 1972), pp. 647-698

Gordon R. J. (2018), Friedman and Phelps on the Phillips Curve Viewed from a Half Century’s Perspective, NBER Working Paper Series, No. 24891, Cambridge, National Bureau of Economic Research, August 2018, pp. 1-14

Knell M. (2002), The effects of EMU on euro area unemployment, Atlantic Economic Journal, September 2002, Volume 30, Issue 3, pp. 244-262

Lucas R. (1972), Expectations and the Neutrality of Money, Journal of Economic Theory,1972, vol. 4, issue 2, pp. 103-124

Lucas R. (1973), Some International Evidence on Output-Inflation Tradeoffs, The American Economic Review, Vol. 63, No. 3, (Jun. 1973), pp. 326-334

Milas, C., & Legrenzi, G. (2006). Non-linear real exchange rate effects in the UK labor market. Studies in Nonlinear Dynamics & Econometrics, 10(1), 1–34

Mohammadi, T., & Gholami, A. (2008). An investigation into the effects of the policy of exchange rate unification on major variables of macroeconomic. Economic Questionnaire, 29, 49–74

Nyahokwe, O., & Ncwadi, R. (2013). Impact of exchange rate volatility on unemployment in South Africa. Mediterranean Journal of Social Sciences, 4(3), 109–120

Phelps E. S. (1967), Phillips Curves, Expectations of Inflation and Optimal Unemployment Over Time, Economica, New Series, Vol. 34, No. 135 (Aug. 1967), pp. 254-281

Phelps E. S. (1968), Money-Wage Dynamics and Labor-Market Equilibrium, Journal of Political Economy, 1968, Vol. 76, No. 4, Part 2 (Jul.-Aug. 1968), pp. 678-711

Phillips A. W. (1958), The relation Between Unemployment and the Rate of Change of Money Wage Rates in United Kingdom 1861-1957, Economica, New Series, Vol 25, No. 100 (Nov. 1958), pp. 283-299

Prasanna, V. S., & Gopakumar, K. (2009). An Empirical Analysis of Inflation, Unemployment and Economic Growth in India from 1973 -2008

Richard, T. B., Ching-Fan, C., & Margie, A. T. (1996). Analyzing Inflation by the Fractionally Integrated ARIMA-GAGCH Model for the Period 1960-1992, Journal of Applied Econometrics, issue 11, 23-40

Samuelson P. A. and Solow R. M. (1960), Analytical Aspects of Anti-Inflation Policy, The American Economic Review, Vol. 50, No. 2, Papers and Proceedings of the Seventy-second Annual Meeting of the American Economic Association (May 1960), pp. 177-194

Sargent T. and Wallace N. (1975), “Rational” Expectations, the Optimal Monetary Instrument, and the Optimal Money Supply Rule, Journal of Political Economy, 1975, vol. 83, issue 2, pp. 241-254

Shaari, M. S., Hussain, N. E., & Abdul Rahim, H. (2013). The effects of oil price changes and exchange rate volatility on unemployment: Evidence from Malaysia. International Journal of Research in Business and Social Science, IJRBS, 2(4), 72–83

https://www.bnr.ro

https://ec.europa.eu/eurostat

https://www.zf.ro