Modern DSGE models are microfounded and have deep parameters that should be invariant to changes in economic policy, so in principle they are not subject to the Lucas critique. But the literature has already established that misspecification issues also cause parameter instability after policy...

This paper addresses the issue of measuring the NAIRU in the Spanish economy. We implement some of the procedures proposed in the literature to estimate the NAIRU, describing their advantages and disadvantages. Our analysis shows that these alternative approaches provide significantly different...

The paper deals with the statistical treatment of macroeconomic data for short-run economic analysis, monitoring and control. The main applications are short-term forecasting and unobserved components estimation, including trend and cycle estimation, and, most often, seasonal adjustment. The...

This paper is an attempt to provide an updated assessment of what we know and what do not know about the impact of monetary policy on the economy and what implications follow for the conduct of monetary policy in today's world. Firstly, we discuss the conditions under which monetary policy can...

In this paper we construct a dynamic stochastic general equilibrium model for a small open economy allowing for perfect capital mobility. The model incorporates price rigidities in monopolistically competitive goods and labor markets and real rigidities in the form of capital adjustment costs....

Global macroeconometric models can be a powerful tool for economic analysis and forecasting in various scenarios. This paper analyses the NiGEM model and its application to the euro area, placing particular emphasis on the study of the relative situation of the member countries' economies.

One of the most striking macroeconomic phenomena in recent decades has been the achievement of rather low and more stable rates inflation in many countries in the nineties. Consequently, the main goal of this paper is to offer an overview of the main policy issues arising in a low inflation...

Exchange rate targets in a stabilization game are considered. The targeting strategy consists on the choice of a desired level for the exchange and the weight assigned to such target in the loss function. The exchange rate target appears then as an intermediate objective and acts as a surrogate...