Unemployment Persistence Insouthern African Countries: Further Evidence from Panel Unit Root Tests

Abstract

The purpose of this study is to investigate the nonstationarity properties of unemployment rate in Southern African Countries over the period 1991 to 2014. In particular, we also analyze the hysteresis of unemployment rate in Botswana and South Africa.We used first and second generation panel unit root tests to determine whether output fluctuations are permanent or transitory.Our findings suggest that the shocks to unemployment rate are generally permanent. Results have important policy implications for macroeconomic policy in Southern Africa.