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ISSN 2071-789X

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  • General Founder and Publisher:

    Centre of Sociological Research


  • Publishing Partners:

    University of Szczecin (Poland)

    Széchenyi István University, (Hungary)

    Mykolas Romeris University (Lithuania)

    Alexander Dubcek University of Trencín (Slovak Republic)

  • Membership:

    American Sociological Association

    European Sociological Association

    World Economics Association (WEA)




Asymmetric Okun's law in an emerging market: ASEAN-3 case

Vol. 13, No 3, 2020

Agus Widarjono


Department of Economics, 

Faculty of Business and Economics, Universitas Islam Indonesia, Yogyakarta, Indonesia


Asymmetric Okun's law in an emerging market: ASEAN-3 case




Abstract. This study examines the force of the asymmetric Okun's law in Malaysia, the Philippines, and Singapore (the ASEAN-3). We employ the cointegration test using the nonlinear autoregressive distributed lag (NARDL) and the asymmetric Pooled Mean Group (PMG) model. Our findings conclude that the cointegration between unemployment and output is found, and the asymmetric Okun's law exists in all the countries under consideration. This suggests that economic upturn and downturn have different impacts on the unemployment in the ASEAN-3. More importantly, economic downturns have a larger impact on unemployment than economic booms. However, positive or negative long-run asymmetric Okun varies across the countries. The Philippines created more jobs during an economic upturn and Singapore lost more jobs during an economic downturn than other countries.  The asymmetric PMG confirms that rising and falling domestic output has a significant impact on unemployment. The asymmetric panel also proves that economic downturns have a stronger impact on unemployment than economic upturns in the ASEAN-3.


Received: October, 2019

1st Revision: April, 2020

Accepted: September, 2020


DOI: 10.14254/2071-789X.2020/13-3/12

JEL ClassificationC22, C23, E32, J64

Keywords: Okun's law, NARDL, asymmetric panel cointegration, ASEAN-3