On Econometrics with a Human Face and Business Cycles: A Reply to Fioramanti and Waldmann's Criticism on the EU’s NAWRU Methodology

Atanas Hristov and Werner Roeger

No 22, European Economy - Economic Briefs from Directorate General Economic and Financial Affairs (DG ECFIN), European Commission

Abstract: A recent VOX article by M. Fioramanti and R. Waldmann criticises the way the European Commission estimates the unemployment gap for EU countries and especially the gap for Italy. This economic brief refutes the criticism and, in turn, argues that the implicitly suggested approach from Fioramanti and Waldmann for estimating the unemployment gap leads to results which, firstly, are problematic on purely economic grounds and, secondly, have dubious statistical properties.

Keywords: Potential output; Natural rate of unemployment; Output gap; Unemployment gap; Phillips curve; On Econometrics with a Human Face and Business Cycles; A Reply to Fioramanti and Waldmann's Criticism on the EU’s NAWRU Methodology; Hristov; Roeger. (search for similar items in EconPapers)
JEL-codes: E31 E32 O4 (search for similar items in EconPapers)
Pages: 16 pages
Date: 2017-03
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

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