We calculate the NAIRU for the U.S. in a framework where inflation and the unemployment rate can respond to each other. The NAIRU is defined as the component of the actual unemployment rate that is uncorrelated with inflation in the long run. Using a structural VAR approach, the NAIRU and core inflation can be estimated simultaneously. Our estimation results show that the NAIRU falls dramatical...

We calculate the NAIRU for the U.S. in a framework where inflation and the unemployment rate can respond to each other. The NAIRU is defined as the component of the actual unemployment rate that is uncorrelated with inflation in the long run. Using a structural VAR approach, the NAIRU and core inflation can be estimated simultaneously. Our estimation results show that the NAIRU falls dramatical...

This paper deals with a critical assessment and a reestimation of the “non–accelerating inflation rate of unemployment” (NAIRU) for Germany. There are quite a few obstacles to perceiving the NAIRU as an understandable and easy–to–use analytical instrument, suitable for economic policy: the possibility of a non–vertical Phillips curve (e.g. in times of low inflation), the occurrence of shocks an...

The Non Accelerating In‡ation Rate of Unemployment (NAIRU) is estimated for the post-stabilization period, as an unobserved stochastic variable, using state-of-the-art State Space Models. The NAIRU is identi...ed by a Phillips curve equation, and is assumed to follow a random walk. The basic model is augmented by an equation that captures the persistence of the unemployment gap. We also use the...

2 Introduction 3 NAIRU vs. Keynes: conflicting theories of unemployment 4 Empirical work (review) 6 Econometric method 7 Testing the NAIRU story 8 Testing the Keynesian story 11 Combining NAIRU and Keynesian factors 12 Conclusion 14 Bibliography 15 Tables 17 Table 1. A NAIRU model 17 Table 2. A Keynesian model 18 Table 3. Unmployment regression: u = c + ∆ infl + rr + ud + tw + tot 19 Table 4. U...

Starting from a Post-Keynesian model in which employment is determined by effective demand and the NAIRU is viewed as a limit to employment, enforced by monetary policy reacting upon conflict inflation, the effects of central bank independence and labour market institutions on macroeconomic performance are considered and the perspectives for employment and inflation in the European Monetary Uni...

In a Kaleckian monetary distribution and growth model with conflict inflation we assess the role of a Non Accelerating Inflation Rate of Unemployment (NAIRU). The short run stability of a NAIRU is examined taking into account real debt effects of accelerating and decelerating inflation, and the short run effectiveness of monetary policy interventions applying the interest rate tool is analysed....

The “NAIRU” view of the reiationsbi~ be tween inflation and the unemployment r&e is that there is a value of the unemployment rate (the NAIRU) below wbicb the price level forever accelerates and above which the price level foxever deceiemtes.” This view imposes two important restrictions 01t the dynamics of the price process. This can be seen by examining a simple version of the NAlRU equation:

150 wds) The paper presents a Post Keynesian view of unemployment. It argues, firstly, that the effective labour demand need not be downward sloping with respect to real wages and aggregate demand need not be downward sloping with respect to inflation; secondly, that there is a broad case for unemployment hysteresis, understood as endogeneity of the NAIRU, based on social norms in wage bargaini...

This paper confirms that the unemployment rate associated with stable inflation, the socalled “NAIRU,” probably has declined in recent years, after having risen sharply during the late 1970s and early 1980s. Although a demographic shift toward a less experienced workforce and an unexpected slowdown in trend productivity growth are able to explain the earlier rise in the NAIRU, a reversal of the...