No. 1/2010: ASYMMETRIC UNEMPLOYMENT RATE DYNAMICS IN AUSTRALIA. Gunnar
Bårdsen, Stan Hurn and Zöe McHugh
Abstract:
The unemployment rate in Australia is modelled as an asymmetric and non-linear function of
aggregate demand, productivity, real interest rates, the replacement ratio,
and the real exchange rate. If changes in unemployment are big, the
management of of demand, real interest rates and
the replacement ratio will be good policy instruments to start bringing it
down. The model is developed by exploiting recent developments in automated
model-selection procedures.
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