In recent years, the OECD has measured the structural rate of unemployment by an indicator called the Non-Accelerating Wage Rate of Unemployment. The NAWRU-indicator is an important element in the policy analysis of the OECD. The rise in the estimated NAWRUs is also taken as evidence that Nordic...

We show that a monetary conditions index in unlikely to be a useful operational policy tool unless numerous assumptions are satisfied by the empirical model from the MCI is dirived.