MAKROEKONOMETRICKY MODEL EUROZONY

In: Politická ekonomie: teorie, modelování, aplikace, Band 63, Heft 3

Abstract

The aim of this paper is the formulation and econometric estimation of a small macroeconomic model, which is intended to provide an understanding of fundamental economic relationships in the eurozone. Unemployment is used to represent real economic activity. Phillips curve links unemployment with inflation and Taylor rule describes the monetary policy of the European Central Bank. The results from econometric estimation indicate that interest rate policy of the European Central Bank has only a very limited effect on unemployment. Furthermore, the reaction coefficient for inflation in the Taylor rule does not support Taylor principle. This paper also presents original method for measuring NAIRU. The proposed method for estimating NAIRU uses probabilities of finding and loosing a job. These probabilities are made endogenous in the model, which is the main contribution of the paper. Adapted from the source document.