#PHILLIPS CURVE ON EVIEWS 10 PLUS#

From this, the researcher proofs that Phillips curve exist in long run (contrary to 1970’s theory), not in short run (contrary to 19’s theory). Within the short run as it were anticipated inflation (positively) affect inflation rate but there’s no short run relationship between inflation rate and unemployment rate. The finding appears unemployment (contrarily and pitifully) and expected inflation (positively) has long run impact on the current inflation rate. The study utilized Augmented Dickey-Fuller test, Auto Regressive Distributed Lag model and Granger causality test by using Vector Error Correction Model with a time spam of 1984/85-2019/20.

#PHILLIPS CURVE ON EVIEWS 10 PLUS#

Thus, the objective of the study was to investigate the long run and short run relationships, plus to this to look the causality between inflation rate and unemployment in Ethiopia. In this modern world inflation and unemployment’s are a most sensitive issue and needs critical attention to overcome problems which come from those two macroeconomic variables. To continue Ethiopia’s successful path towards becoming a middle income country, it is an important issue focusing on macroeconomic variables. The Existence of Phillips Curve theory in Ethiopia Depend on Augmented Phillips curve theory Analysisĭepartment of Economics, Mizan Tepi University

Phillips curve on eviews 10