…as the NAIRU can shift due to hysteresis (this is still so brand new that it hasn’t been incorporated into standard macro models after an alleged 25 but actual 53…

…not a straightforward accounting measurement like Personal Consumption Expenditures or Corporate Profits. It’s much more like estimates of the non-accelerating inflation rate of unemployment (NAIRU) or Potential GDP. It’s an…

…something Friedman (or Phelps) thought up, and that neither Friedman (nor Phelps) was thinking that high unemployment might deanchor the NAIRU. comes Angry Bear Robert Waldmann’s reply to a comment,…

…similar forecast errors. Thus it is very possible that the inflation phobia of the 80s and 90s caused high estimates of the non accelerating inflation rate of unemployment (NAIRU) and…

…rate + inflation target + 1.3*(inflation – inflation target of 2%) – 1.9*(unemployment rate – natural unemployment rate target) Let’s test data through this equation. (I use the Short-term NAIRU…

…than 2%” is the reason to accept NAIRU unemployment when the unemployed wish they had jobs. In this case, it is a benefit. It is possible to make an argument…

…assume that there are two key unemployment rates. The NAIRU and a higher rate needed before nominal wages are cut. Given differences in different local labor markets, downward nominal wage…

…worried about low wage inflation. He recognizes that the unemployment rate is getting close to his projection of 5.2% as the full employment rate in the NAIRU sense. He anticipates…

…output that must slowly come back to reality.) This point was also reflected in a post by Paul Krugman today where he sees the Fed’s projection of the NAIRU receding…

…inflationary. The conventional persuader is unemployment. One doesn’t have to subscribe to the NAIRU doctrine that insufficient unemployment accelerates inflation to concede that policy-induced unemployment tips the scales against wage…