Authors : Mohammad Rashidul Abedin

Volume/Issue : Volume 11 - 2026, Issue 5 - May

Google Scholar : https://tinyurl.com/bddscyyh

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DOI : https://doi.org/10.38124/ijisrt/26May668

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Abstract : This study investigates the macroeconomic determinants of youth unemployment in nine developing Asian countries over 29 years using panel data regression techniques and both fixed- and random-effect models, with diagnostic tests for multicollinearity, heteroskedasticity, and autocorrelation. Macroeconomic variables influence youth unemployment in developing Asian countries, including South Asia and ASEAN, primarily through structural and labor-market mechanisms. Economic growth often shows skill-biased patterns, particularly in lower-income South Asian economies such as Bangladesh, Nepal, and Pakistan. At the same time, labor productivity and formal wage employment reduce youth unemployment, especially in more industrially diversified ASEAN economies like Malaysia, Thailand, Indonesia, and the Philippines. Inflation has a limited overall effect but can influence unemployment in the short run. Government education spending may increase youth unemployment when educational expansion exceeds the creation of high-skill jobs. Overall, youth unemployment is driven more by structural factors, as shown by the existing heterogeneity between countries or groups of countries by region. Key determinants are labor-market participation and education–employment alignment rather than short-term macroeconomic fluctuations. Short-run macroeconomic factors, such as nominal GDP or price changes over a single year, do not necessarily affect youth unemployment; rather, sustained education spending, aligned structural changes in the labor market, and productivity enhancements across successive economic cycles do.

Keywords : Youth Unemployment, Developing Asian Countries, Panel Data, Macroeconomic Determinants, Structural Alignment, Sustained Education Spending, Productivity Transformation, Successive Economic Cycles.

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