Using Monte Carlo simulations, this paper evaluates the ability of the trend-cycle decomposition approach of Hamilton (2018) to adequately identify asymmetries in business cycles fluctuations. By considering different specifications of linear and asymmetric processes consistent with previous...

We examine the relationship between wage inflation and the unemployment rate in the U.S. economy for the 1964-2014 period by means of a three-regime threshold regression model. The estimated threshold parameters suggest that this relationship changes when the unemployment rate transitions...