Table of Contents
Economics Research International
Volume 2014, Article ID 436527, 7 pages
http://dx.doi.org/10.1155/2014/436527
Research Article

Phillips and Wage Curves: Empirical Evidence from Bosnia and Herzegovina

1Center for Advancement of Free Enterprise, Dr. Ćire Truhelke 10/A, 72000 Zenica, Bosnia And Herzegovina
2Faculty of Economics and Administrative Sciences, Turkish-German University, Şahinkaya Caddesi 86, Beykoz, 34820 Istanbul, Turkey

Received 26 June 2014; Revised 17 August 2014; Accepted 17 August 2014; Published 31 August 2014

Academic Editor: Magda E. Kandil

Copyright © 2014 Edo Omerčević and Elif Nuroğlu. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

Abstract

This study is an empirical examination of the existence and characteristics of the Phillips curve and the wage curve in Bosnia and Herzegovina. The findings indicate that there is no evidence of the existence of the short-term Phillips curve. Instead, the data suggests that in the short-term an increase in inflation leads to an increase in unemployment. The estimated wage curves indicate that only increases in real payment increase employment. The conclusion of this study is that increases in inflation might have a negative short-term impact on the level of employment in Bosnia and Herzegovina.