The relationship between output and unemployment: Evidence from Greek regions

This research note investigates the relationship between output and unemployment in Greece at a regional level through the implementation of Okunss law. Current practice is primarily restricted to the national level, and thus ignores the regional dimension of this relationship. To this end, we apply modern unit root test and cointegration techniques based on panel data settings. Using panel data is necessary because typical spans of economic time series are short, so the entire panel must be exploited in order to draw sharper inferences. The empirical results reveal that Okuns law can be confirmed for six out of the 13 regions we examine.Received: 20 November 2002, Accepted: 5 November 2003, JEL Classification: C23, E32, O18Dimitris K. Christopoulos: I would like to thank two anonymous referees and the European editor, whose comments greatly strengthened the notes content. Thanks are also extended to Dr. V. Arapoglou for helpful suggestions on an earlier version. The usual disclaimer applies