Macroeconomics 12th Edition by Rudiger Dornbusch ,Stanley Fischer,Richard Startz

تمرين 5

Okun's law-1 extra point of unemployment costs 2 percent of GDP-illustrates the concept by the unemployment-output relation in the United States. After reading the chapter, you might ask yourself: But does this hold in other countries as well In this exercise we are going to investigate the unemployment-output relationship for Australia (if you are interested, you might repeat this exercise for other countries as well) and see whether Okun's law fits it.
a. Using http://bls.gov/fls and the Penn World Tables (http://pwt.econ.upenn.edu), download data for the Australian unemployment rate and RGDP over the period 1970- 2007 into an EXCEL file. The unemployment rate for Australia can be found by going to http://bls.gov/fls and clicking on "Top Picks," clicking on Australia, and selecting "Unemployment Rate." RGDP can be found at the Penn World Tables (http://pwt.econ.upenn.edu) by clicking on "Penn World Table," "Data Download," selecting "Australia," and downloading both data for Population ("POP") and RGDP per Capita ("cgdp") and multiplying the two series together
b. Calculate the annual growth rate of RGDP ([ RGDP t - RGDP t 1 ]/ RGDP t 1 X 100) and the change in the unemployment rate ( u t - u t 1 ). Create a scatterplot that has the change in the unemployment rate on the X axis and the growth rate of RGDP on the Y axis. What is the relationship between unemployment and output in Australia Visually, on average by how much would an increase of 1 percentage point in the unemployment rate affect output
c. * If you have taken a statistics class, use EXCEL or a statistical program in order to run the following regression:

What is the implied slope What does it mean Is it statistically significant Can you set up a test to see if it is different from the usually cited number of 2 percent