okun's law:output growth and changes in unemployment e Using letters rather than numbers let us write the relation between output growth and the change in the unemployment rate as t-1 b(gyt gy (113) Where g, is the normal growth rate of the economy(about 3% for the United States), and B tells us how growth in excess of normal growth translates into decrease in the unemployment rate 2003-7-28 62003-7-28 6 Okun’s law:output growth and changes in unemployment Using letters rather than numbers, let us write the relation between output growth and the change in the unemployment rate as: ut –ut-1= -β(gyt - gy ) (11.3) ⚫ Where gy is the normal growth rate of the economy (about 3% for the United States), and β tells us how growth in excess of normal growth translates into decrease in the unemployment rate