The relation between unemployment and economic growth during the period of inflation targeting in Turkey

It's thought that the implementation of the inflation targeting regime of Turkey's economy cause a difference between the dynamic relationship and unemployment rate and the unemployment rate and the output gap. In this study, the reletionship between unemployment rate and economic growth and unemployment rate and output gap was examined by using the data from the 2002:Q2-2018:Q2 period in which Turkey applied inflation targeting. In the study, the stasis of variables was first tested using expanted Dickey&Fuller (1981, ADF) and Phillips&Perron (1988, PP) unit root tests. After that the ARDL limit test model was used to test the relationship. The findings of the study concluded that inflation targeting in the Turkey economy had a weak long-term impact on the unemployment rate and the output gap. Keywords: Inflation targent, Okun's Law, ARDL