THE DETERMINANTS OF UNEMPLOYMENT IN CHINA

Liong, Shee Shee (2022) THE DETERMINANTS OF UNEMPLOYMENT IN CHINA. [Final Year Project Report] (Unpublished)

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Abstract

This study is to analyze the factors such population growth, gross domestic product growth and inflation rate that affecting the unemployment rate in China. The annually data of China from 1990 until 2020 had been used to run the empirical analysis. Augmented Dickey-Fuller (ADF) test, Phillip-Perron (PP) test, Kwiatkowski Philips Schmidt Shin (KPSS) test, Johansen and Juselius (JJ) cointegration test, and Granger Causality test based on Vector Error Correction Model (VECM) had been used inside this study to answer the objectives. The finding results from inside this study had showed that all the series, UEN, POP, GDP, and INFLA is non-stationary at level but had become stationary at first difference. Next, there is one cointegration vector existing in the model inside this study, so there is a long run relationship exists between the variables of UEN, POP, GDP and INFLA. Plus, there is a positive relationship founded between the GDP, INFLA with the UEN, while POP and UEN had negative relationship. The findings had showed a unidirectional causality relationship from INFLA to GDP, and there is no causality relationship exists from the all the independent variables towards the dependent variable inside this study.

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