Evaluating a Monetary Business Cycle Model with Unemployment for the Euro Area

National Bank of Belgium Working Paper No. 173

49 Pages Posted: 28 Sep 2010

See all articles by Nicolas Groshenny

Nicolas Groshenny

Reserve Bank of New Zealand; Australian National University (ANU) - Centre for Applied Macroeconomic Analysis (CAMA)

Date Written: July 27, 2009

Abstract

This paper estimates a medium-scale DSGE model with search unemployment by matching model and data spectra. Price mark-up shocks emerge as the main source of business-cycle fluctuations in the euro area. Key factors in the propagation of these disturbances are a high degree of inflation indexation and a persistent response of monetary policy to deviations from the inflation target.

Keywords: DSGE models, business cycles, frequency-domain analysis

JEL Classification: E32, C51, C52

Suggested Citation

Groshenny, Nicolas, Evaluating a Monetary Business Cycle Model with Unemployment for the Euro Area (July 27, 2009). National Bank of Belgium Working Paper No. 173, Available at SSRN: https://ssrn.com/abstract=1683897 or http://dx.doi.org/10.2139/ssrn.1683897

Nicolas Groshenny (Contact Author)

Reserve Bank of New Zealand ( email )

6011

Australian National University (ANU) - Centre for Applied Macroeconomic Analysis (CAMA)

ANU College of Business and Economics
Canberra, Australian Capital Territory 0200
Australia

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