ИНФЛАЦИЈА И НЕЗАПОСЛЕНОСТ У БОСНИ И ХЕРЦЕГОВИНИ

Abstract

The Phillips curve suggests that there is an inverse relationship between unemployment and inflation. However, some more modern approaches point to the complexity of the relationship between inflation and unemployment, and unpredictable interactions that are especially characteristic of the long run. This paper analyzes the impact of changes in the unemployment rate on changes in the inflation rate in BiH in the period 2000-2023. For this analysis, the Engle-Granger method for testing cointegration as well as the estimation of the ECM model were used. The results show that in the short run there is an inverse relationship between unemployment and inflation, but it is not statistically significant, and that in the long run there is a stable long-term relationship between these variables.