Unemployment Rate and GDP Growth Rate in Selected European Countries

Abstract

GDP growth rate and unemployment rate are two crucial macroeconomic variables - their correlation is an important indicator for policymakers and it has been frequently analyzed. This research aims to analyze the GDP growth rate and unemployment rate in EU founders, Visegrad group, and Western Balkan countries and to determine if the negative correlation between these variables exists, to point to differences between developed and developing countries, and to indicate real convergence of developing countries towards developed ones. Data is analyzed on a quarterly level from Q1 2010 to Q4 2021 and the methodology of this paper consists of empirical data analysis, descriptive statistics, and panel analysis for each country group. Obtained results point to a negative correlation in all 3 country groups, but it is statistically significant only in EU founders countries, and the convergence of the Visegrad group and Western Balkan countries towards developed ones can be acknowledged.