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Exploring the relationship between inflation and unemployment in South Africa A historical, theoretical, and empirical review

Author

Listed:
  • Chigozie Azunna

    (University of South Africa)

  • Lucius Botes

    (North-West University, South Africa)

Abstract

The paper investigates the relationship between inflation and unemployment in the South African setting, encompassing a comprehensive analysis of historical, theoretical, and empirical evidence. Existing literature surveys demonstrate that several studies have been conducted in multiple countries to ascertain the correlation between inflation and unemployment. The review incorporated the postulations of many economic schools of thought as they are applied to South Africa. The Phillips Curve was examined in accordance with the research purpose. The process involves gathering secondary data from reputable sources such as Statistics South Africa, the South African Reserve Bank, and other reliable secondary sources to analyse this relationship. The findings are presented using linear regression, tables, and figures. The study utilised annual inflation and unemployment data in South Africa spanning from 2000 to 2022 to elucidate the correlation between inflation and unemployment. The study discovered that the link was nonlinear and did not exhibit any meaningful association or correlation. Key Words:Inflation, Unemployment, Philips Curve, Monetarists, Neo Keynesian

Suggested Citation

  • Chigozie Azunna & Lucius Botes, 2024. "Exploring the relationship between inflation and unemployment in South Africa A historical, theoretical, and empirical review," International Journal of Research in Business and Social Science (2147-4478), Center for the Strategic Studies in Business and Finance, vol. 13(3), pages 294-302, April.
    • Handle: RePEc:rbs:ijbrss:v:13:y:2024:i:3:p:294-302
    DOI: 10.20525/ijrbs.v13i3.3129
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    References listed on IDEAS

    as
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    3. Meltzer, Allan H, 1977. "Anticipated Inflation and Unanticipated Price Change: A Test of the Price-Specie Flow Theory and the Phillips Curve," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 9(1), pages 182-205, February.
    4. Eugene Msizi Buthelezi, 2023. "Impact of Inflation in Different States of Unemployment: Evidence with the Phillips Curve in South Africa from 2008 to 2022," Economies, MDPI, vol. 11(1), pages 1-12, January.
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    9. Santomero, Anthony M & Seater, John J, 1978. "The Inflation-Unemployment Trade-off: A Critique of the Literature," Journal of Economic Literature, American Economic Association, vol. 16(2), pages 499-544, June.
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