Estimating Europe’s natural rates
2010 | journal article
Jump to: Cite & Linked | Documents & Media | Details | Version history
Documents & Media
Details
- Authors
- Berger, Tino
- Abstract
- This article estimates potential output, the natural rate of unemployment, and the core inflation rate using aggregated euro area data. The empirical model consists of a Phillips curve linking inflation to unemployment. An Okun-type relationship is used to link the output gap to cyclical unemployment. The model further accounts for new developments in unobserved component models by allowing (i) for correlation between shocks to the natural rates and the corresponding gaps and (ii) structural breaks in the drift of potential output and the natural rate of unemployment.
- Issue Date
- 2010
- Journal
- Empirical Economics
- Language
- English