Tagged: Lawrence Summers

by smteixeirapoit In 1962, economist Arthur Okun stated that when the economy expands, employment rises at a predictable rate and when the economy contracts, employment declines at a similar rate. Recently, Lawrence Summers, Director of President Barack Obama’s National Economic Council, commented that “Okun’s Law” may be incorrect. In the United States, employment rates decreased faster than Okun’s law predicted. Although Okun’s law suggested that the unemployment rate should be around 8.5 percent, it is around 10.0 percent. A recent...