[{"data":1,"prerenderedAt":58},["ShallowReactive",2],{"term:okuns-law":3},{"term":4,"related":45},{"id":5,"title":6,"body":7,"category":27,"description":28,"extension":29,"faq":30,"meta":31,"navigation":32,"path":33,"related":34,"seo":38,"stem":39,"takeaways":40,"__hash__":44},"terms\u002Fterms\u002Fokuns-law.md","Okun's Law",{"type":8,"value":9,"toc":22},"minimark",[10,15,19],[11,12,14],"h2",{"id":13},"understanding-okuns-law","Understanding Okun's Law",[16,17,18],"p",{},"Economist Arthur Okun observed in the 1960s that U.S. output falls well below potential when unemployment rises. A common modern estimate is that each percentage point of unemployment above its natural rate goes with output about 2% below potential.",[16,20,21],{},"It is an empirical regularity, not a law of nature, and the ratio varies across countries and periods.",{"title":23,"searchDepth":24,"depth":24,"links":25},"",2,[26],{"id":13,"depth":24,"text":14},"economy","A rule of thumb linking unemployment to the gap between actual and potential output.","md",[],{},true,"\u002Fterms\u002Fokuns-law",[35,36,37],"output-gap","unemployment-rate","natural-rate-of-unemployment",{"title":6,"description":28},"terms\u002Fokuns-law",[41,42,43],"Higher unemployment goes with output below potential.","A common rule of thumb is about 2% of output per point of unemployment.","The relationship is approximate.","kUAsCEBv0HPoljTMZAt188740HDtgrGW-wBJkJj7vbs",[46,50,54],{"title":47,"description":48,"path":49},"Natural Rate of Unemployment","The unemployment rate that persists when the economy is at full strength, also called the NAIRU.","\u002Fterms\u002Fnatural-rate-of-unemployment",{"title":51,"description":52,"path":53},"Output Gap","The difference between actual GDP and potential GDP.","\u002Fterms\u002Foutput-gap",{"title":55,"description":56,"path":57},"Unemployment Rate","The share of the labor force that is jobless but available and actively looking for work.","\u002Fterms\u002Funemployment-rate",1793374005537]