Thursday, March 31, 2011

Is higher investment decreasing the unemployment rate in America?

John Taylor states high investment is the most effective way to reduce unemployment (click here to see the graph). The following graphs show the same variables with data for all countries in the Americas from 1980 to 2008. Lower unemployment lead by a greater investment-GDP ratio is not observed in all regions of the continent, which could be explained, in Mexico for example, by structural change – less people are hired due to high investments in technology.

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