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Academic Journal of Business & Management, 2020, 2(3); doi: 10.25236/AJBM.2020.020309.

Testing the Influential Factors of Unemployment in the Developed World


Aiyun Zhang1* , Haosen He2

Corresponding Author:
Aiyun Zhang

1.Shandong Women’s University, Jinan 250300, China
2.Wake Forest University,NC27109,United States
*Corresponding Author


This study tests a set of theoretically influential factors of unemployment with a 16-year long panel consisting 32 OECD countries. These factors include government policies, union power, real per capita GDP growth and internet access. Both an OLS and a 2SLS model are estimated to address simultaneity bias. It finds that while expenditure on active labor market programs (ALMP) is negatively associated with the unemployment rate, unemployment benefits, wage bargaining, labor market regulations and hiring firing restrictions are positively associated with the unemployment rate. However, these results are subjected to bias and may not be completely trustworthy.


Influential factors, Unemployment rate, OLS model, 2SLS model

Cite This Paper

Aiyun Zhang, Haosen He. Testing the Influential Factors of Unemployment in the Developed Worldy. Academic Journal of Business & Management (2020) Vol. 2, Issue 3: 54-67. https://doi.org/10.25236/AJBM.2020.020309.


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