Research On The Relationship Between Economic Growth And Unemployment

Economic growth and unemployment are two main research subjects in Macroeconomics, both of which have made great achievements. But research on relationship between the long-run growth and unemployment has been neglected. Whether can economic growth always bring decrease of unemployment and increase of employment, or not? What we find that economic growth can also make increase of the unemployment rate by modeling the dynamic process of China's economic growth is contrary to the traditional thesis. The exist of the dual economy, especially the dual labor market and the dual financial market, plays an important role in making this relationship. In order to change this bad situation, some measures ought to be taken. The first is improving the transferring speed of the surplus labor. The second is to choose appropriate production technology. The last is to make rational and complete market construction of factors.The paper's structure is following , Chapter one introduces the development of the research on the relationship between economic growth and unemployment. Chapter two is the two-sector model, which generates endogenous economic growth and unemployment of Chinese economy. Chapter three makes empirical analysis to prove some conclusions in Chapter two. Chapter four gives some theoretical explanations, which based on the exist of dualism. And the last chapter is conclusion of the whole paper and gives some policy suggestion.