There is a growing recognition in the literature on business cycles that production technologies may give rise to complicated interactions between seasonal and cyclical movements in economic time series, which can distort business cycle inference based on seasonally adjusted data. For the most...

This paper analyses the recent productivity slowdown, attempting to distinguish permanent from cyclical changes. It then considers the implications for anti-inflationary policies, discussing the short-run effects of more restrictive policies as well as the prospects for reducing inflation in the...

This paper summarises the main features of an expectations-augmented Phillips curve with accompanying mark-up price equations. The empirical counterparts for six countries are presented. Even though preliminary, the results are relatively satisfactory in terms of statistical fit and a priori...

As central banks have moved towards a forward-looking implementation of monetary policy, the role of forecasts in the policy process has greatly increased. Against this background, this paper looks at the accuracy of forecasts and, more specifically, addresses the question whether forecasts of...

Iceland was a high inflation country from the second half of the seventies and until the middle of the eighties. During the middle of the nineties inflation in Iceland, at less than 2% p.a., was among the lowest in the OECD. In this paper we analyse the roots of high inflation in Iceland and the...

From an international perspective, the European rate of unemployment has been high and growing over the last one to two decades; against this background, the parallel rise in profit shares in a number of European countries seems to be at odds with expected economic behaviour. This paper...

Since the trough in 1982, the growth of real foreign direct investment (FDI) outflows and inflows for the OECD countries has been very high, far outpacing that of foreign trade and real GDP. While such flows are likely to have increased the efficiency with which global capital is being used,...

The purpose of this note is to derive measures of ex ante long-term real interest rates that satisfy Fisher's notion of a long-run relationship between expectations of inflation and nominal interest rates. We do so by adopting a backward-looking approach that also takes account of the increasing...

This cross-country study provides empirical evidence on the influence of house prices on the aggregate consumption and saving behaviour of households. Housing wealth constitutes a significant portion of total wealth for households, suggesting that their expenditure patterns are likely to reflect...

The main purpose of this paper is to test the hypothesis that, especially in Europe, excessive real wage growth and falling profit shares have been instrumental in reducing investment growth and the employment potential of the capital stock. We also consider the policy implication that a...