The impact of macroeconomic variables toward unemployment rate in developing countries / Siti Asmi Admain

The research’s main objective is to measure the significant impact of macroeconomic
variables toward unemployment rate in developing countries. The method that researcher
used to conduct for this project paper is Breusch Pagan and Lagrangian Multiplier
(BPLM) test and the result is pooled by Ordinary Least Squares (OLS). Besides, this
project paper also were conducted based on panel data starting from 2007 until 2017
period of time which is 11 years with 10 selected developing countries which includes
Bangladesh, India, Indonesia, Malaysia, Nigeria, Philippines, Pakistan, Sri Lanka,
Vietnam and Thailand which were collected from secondary data which is World Bank
Indicators.
The empirical result and finding revealed that there is positive and negative impact of
macroeconomic variables toward unemployment rate in developing countries. The results
confirms that population, gross domestic product and inflation show a negatively on
unemployment rate in developing countries, while only for labor force rate has inverse
effect on unemployment where it show positively. It can conclude that, the result shows only
for labor force rate is significant and other variables are insignificant.
Keywords: unemployment rate, population, gross domestic product, labor force rate,
inflation and breusch pagan and lagrangian multiplier (BPLM) test.