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:: Volume 5, Issue 17 (6-2015) ::
2015, 5(17): 63-82 Back to browse issues page
Investigating the Relationship between Inflation and Unemployment in Rural Areas in Iran: Application of Neoclassical Philips Curve
Mohammad Reza Rezaeefar , Mohammad Reza Zare Mehrjerdi
Shahid Bahonar University of Kerman
Abstract:   (3089 Views)
Identification and explanation of the relationship between inflation and unemployment in rural areas can contribute to the economic decision making about these areas. This article is an attempt to identify the precise relationship between the above phenomena both in the long term and the short term. So, the purpose of this article is to investigate the relationship between inflation and unemployment in Iran's rural areas from the Neoclassical Philips Curveviewpoint and to investigate the effective factors on these two variables during 1365-1392 (1986-2013 C.E) time series.In this regard, Auto-Regressive Distributed Lag Method (ARDL) and structural methods based on the techniques of Ordinary Least Squares (OLS)were used. In this study, Hodrick-Prescott filter method was used in order to determine the amount of rural invisible expected inflation rate,natural unemployment rate of rural areas, and rural potential output. The results show that the neoclassical Philips curve for Iran's rural areas is statistically significant both in the short term and the long term, that is, unemployment rate and inflation in rural areas are inversely related. In this condition, the Central Bank and the government can highly affect unemployment rate in rural areas through implementing targeted fiscal and monetary policies.
Keywords: Philips Curve, natural unemployment, Auto-Regressive Distributed Lag Method (ARDL), inflation.
Full-Text [PDF 294 kb]   (2262 Downloads)    
Type of Study: Research | Subject: اقتصاد ایران
Received: 2015/05/13 | Accepted: 2015/07/21 | Published: 2015/07/21
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Rezaeefar M R, Zare Mehrjerdi M R. Investigating the Relationship between Inflation and Unemployment in Rural Areas in Iran: Application of Neoclassical Philips Curve. Economic Development Research. 2015; 5 (17) :63-82
URL: http://jrer.ir/article-1-340-en.html


Volume 5, Issue 17 (6-2015) Back to browse issues page
فصلنامه تحقیقات توسعه اقتصادی Journal of Economic Development  Research
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