Income Growth In Morocco: An Analysis of Income Growth Following an ARFIMA Model

This paper analyzes the dynamic interactions between income growth, inflation, and unemployment in Morocco over the period 1990–2025. Income growth is modeled as a stochastic process exhibiting both short-term persistence and potential long-memory effects, captured via an ARFIMA( p, d, q ) specification. The estimated income growth series is then used to investigate its influence on inflation and unemployment, linking income shocks to macro-labor outcomes within a Phillips–Okun framework. By com- bining long-memory income dynamics with empirical macro-labor modeling, the study provides new insights into how persistent fluctuations in income growth shape price adjustments and labor market responses. These findings offer both theoretical and policy-relevant implications for emerging economies experiencing cyclical or structural growth variations. JEL classification: E31; E32; E24; C22