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Unemployment is a big economical and social issue for each country, in particular for Albania, which is a country that comes from a centralized system where the state ensured full employment. In the struggle of applying the transition to market economy, each government had to face the two-digit levels of unemployment. Because of this, the application of the right policies in order to decrease the level of unemployment has been in the centre of the program of each government in Albania. The objective of this paper is to show if the undervaluation or overvaluation of the real exchange rate can affect in a significant way the level of employment in Albania and that to answer the question, if the real exchange rate can be used as a political instrument for the reduction of the level of unemployment. There are relatively few works that study the impact of real exchange rate on the Albanian economy and in my knowledge there is not a previous work on employment and real exchange rate relationship in Albania, so this can be considered as the first study that attempt to assess this relationship. To evaluate the link between the real exchange rate and the level of employment the Johansen procedure and Vector Error Correction Term method is used. The result of the study demonstrates not statistically significant impact of real exchange rate on level of employment, suggesting that the increase of competition of the country through the real exchange rate doesn't improve the condition of the employment in Albania, so the Albanian government should implement other strategies to increase the level of employment in the country. [ABSTRACT FROM AUTHOR]

This paper explores the relationship between financial development and economic growth in South Africa. It employs an Auto Regressive Distributed Lag bounds testing approach and the Vector Error Correction Model to examine this relationship. The starting point of the analysis emanates from the works of Goldsmith (1969) who set out to chart the evolution of financial structures as economies grow and develop and to establish the impact financial development has on growth. The Auto Regressive Distributed Lag results show the existence of a steady relationship between financial development indicators and economic growth and the existence of a long-run relationship among the variables. The Vector Error Correction Model approach has shown a long-run bidirectional relationship from financial development to economic growth, and the banking sector is the main driver for economic growth. The study indicates that the South African financial system plays an important role in the growth of the economy and the variables under study boosts the growth of the economy. The paper thus, contributes to the discussion on the linkages between financial development and economic growth in a growing economy such as South Africa, which is the most developed country with the most advanced financial sector in sub-Saharan Africa. [ABSTRACT FROM AUTHOR]

Real exchange rate is one of the most important economic variables, especially in today's conditions of integration processes, the removal of trade barriers and increasing direct competition between countries. Real exchange rate affects economy, through its impact on key economic variables, such as employment, inflation and especially economic growth. Changes in the real exchange rate affect the competitiveness of domestic products, resulting in increased exports or imports, affecting trade balance e growth. Also changes in the real exchange rate affect investment and capital accumulation, which are directly linked with economic growth. The aim of this paper is to study the possible impact of the real exchange rate on economic growth in Albania, to answer the question whether the real exchange rate can be used as an instrument of policy. Johansen cointegration method and Vector Error Correction Model is used in this paper to identify the longterm and short-term impact of real exchange rate on economic growth in Albania. Results of the study indicate that the real exchange rate has no significant impact on the Albanian economy, suggesting that policies to promote economic growth, both in the short and long term should not rely on this variable. [ABSTRACT FROM AUTHOR]