Abstract

Official statistics indicated a break in Okun’s law in all the Spanish regions due to the COVID-19 pandemic; however, herein, evidence of the validity of the law is shown. The temporary layoff procedures (ERTEs) allowed many workers to maintain their jobs. From the productive point of view, the law remained in effect in the regions, showing a strong relationship between idle labour resources and economic activity, and from the social point of view, the apparent breakdown of the law can be interpreted as the implementation of a policy that mitigated the dramatic impact of the economic crisis.

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