This study estimates the Balassa-Samuelson effect for 7 EU countries. According to this effect, inflation differential between the tradable and the non-tradable sector can be attributed to unbalanced productivity growth between the two sectors. For the euro area this implies that countries with...

The paper aims at estimating the natural rate of unemployment in Greece. The methodology adopted follows that of Hamilton. It is assumed that the rate of unemployment follows a stochastic process with periodic shifts in the mean and variance. The natural rate is then estimated using a Markov...