From New Energy Vehicles to Structural Unemployment

Abstract

In this paper, due to the inspiration of the future fuel policy change in The Formula One, I explain and evaluate that rise in unemployment is caused by the decrease in oil price, vice versa. The explanation part involves the analysis of the change in demand and supply, how it relates to the aggregate demand and hence how it influences the unemployment by using demand and supply model and phillips curve. The evaluation part includes the OLS regression analysis in order to calculate the regression line and significance test which aims to check the validity of the linear relationship. Overall, this model can be used to make prediction for the future, either oil price or unemployment by each other. I believe this research will contribute to the prediction for future unemployment. Therefore, it is beneficial for the governments’ macro policies enaction that satisfies country’s macroeconomic aims.