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Structural Drivers of Unemployment in E7 Economies: A Panel Data Analysis in Line With Sustainable Development Goal 8

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  • B. Yasin Çakmak
  • Büşra Yigit

Abstract

Unemployment remains a persistent challenge for developing economies, particularly within the framework of Sustainable Development Goal 8, which emphasizes inclusive and decent work. This study investigates the long‐run effects of social, economic, and institutional factors, namely, the human development index (HDI), foreign direct investment (FDI), research and development (RD), and institutional quality (IQ), on unemployment in E7 countries over the 1992–2021 period. The study employs long‐term estimators, the augmented mean group (AMG) and regularized common correlated effects (RCCE), which account for cross‐sectional dependence and heterogeneity. Country‐specific results demonstrate the importance of RD in reducing unemployment in China, India, and Indonesia. We also highlight the importance of HDI in reducing unemployment in Russia and Mexico. Conversely, IQ shows mixed results in Russia and Türkiye. These outcomes underscore the need for tailored macroeconomic and social policies to address unemployment in heterogeneous emerging markets. The study contributes to the literature by presenting one of the first integrated empirical models of unemployment in E7 countries in line with SDG 8. It also emphasizes the necessity of multidimensional policy approaches to tackle employment challenges within the sustainable development agenda.

Suggested Citation

  • B. Yasin Çakmak & Büşra Yigit, 2026. "Structural Drivers of Unemployment in E7 Economies: A Panel Data Analysis in Line With Sustainable Development Goal 8," Sustainable Development, John Wiley & Sons, Ltd., vol. 34(S1), pages 1173-1183, January.
    • Handle: RePEc:wly:sustdv:v:34:y:2026:i:s1:p:1173-1183
    DOI: 10.1002/sd.70227
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