“The Trade-Off between Inflation and Unemployment in Egypt during the period (1990-2012), An Econometric study”

Abstract

There is no doubt that unemployment and inflation are severe problems facing the economy, in fact economic literature took a while to understand and decide how to deal with them, and most importantly investigated if there was a certain relation between both of them. Some believed that there was a trade-off between the two that policymakers could exploit. In other words, a lower unemployment rate could be reached by tolerating a higher rate of inflation. Others argued that there is no such a trade-off. In either way, inflation and unemployment caught a lot of attention since they are chronic problems that face a lot of countries. Different countries all over the world have been passing through these cases, as the United States have been through the trade-off relationship between inflation and unemployment, adding to that its stagflation crisis in the 1970s. Europe went through stagnation and high unemployment rates; finally inflation was so profound by the fluctuations in oil prices. All of these experiences will be exhibited thoroughly in addition to the South Korean experience with inflation targeting versus employment targeting and finally an econometric study will be used to analyze the type of relationship between inflation and unemployment. II.o