Wednesday, June 17, 2009

Growth Rate Form of Okun's Law



In this form of Okun's Law, the GDP is constant and grows naturally at 3%. Any deviation from the natural unemployment rate effects output. Since the unemployment rate is currently 9.4%, we are losing output. My calculations indicate that our GDP growth will be a negative 4.2%. I've asymmetrically compared my forecaste with the St. Louis FED. Wikipedia has a full discussion here.

1 comment:

  1. Interesting story as for me. I'd like to read a bit more concerning that topic. Thanks for giving this data.
    Joan Stepsen
    Purely gadgets

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