Silke Tober

Hysteresis and the Nairu in the Euro Area

This paper analyses the Nairu in the Euro Area and the influence that hysteresis had on its development. Using the Kalman-filter technique we find that the Nairu has varied considerably since the early seventies. The Kalman-filter technique is applied here using explicit exogenous variables. In order to test for hysteresis, the dependence of the Nairu on actual unemployment and long-term unemployment is estimated and found to be significant for the Euro Area and Germany respectively. The existence of hysteresis effects implies the possibility of a long-run non-superneutrality of monetary policy.

Squaring the Circle in Euro Land? Some Remarks on the Stability Programmes 2010–13

The global economy and the euro area, in particular, face serious challenges in the years ahead. Throughout the year 2010, politicians and financial investors were mainly concerned with the question of whether Greece and other ‘deficit countries’ should be ‘rescued’ by the other, seemingly more ‘financially responsible’ EMU countries in case of solvency problems.