YOUTH UNEMPLOYMENT, EDUCATION AND ECONOMIC GROWTH: THE CASE OF TURKEY

In this study, it is aimed to investigate the relationship between youth unemployment, education and economic growth in Turkey for the period of 1988-2015 within the framework of Okun’s law, which suggests a negative relationship between unemployment rate and economic growth. In order to determine the long run and the short run relationships between youth unemployment, education and economic growth, the bounds testing approach developed by Pesaran et al.(2001) and error correction model are employed. The findings of this study indicate that there is a long-run relationship between education, economic growth, and youth unemployment. According to the long-run coefficients, that 1 percentage increase in the deviation from trend of Gross Domestic Product causes 0.48 percentage decrease in the deviation from trend of youth unemployment. The results of this study show that 1 percentage increase in the deviation from trend of number of high school graduates decreases 1.05 percentage deviation from trend of youth unemployment