Traditional approaches to consumer demand modelling ignores the problem associated with product heterogeneity where important product characteristics are latent. The point of departure in the present study is a particular framework developed in Dagsvik (1996a,b) and Dagsvik et al. (1998). In...

In this paper, a subsystem of demand equations is estimated using data from the Norwegian survey of household expenditures 1989-1991. One objective has been to obtain substantial knowledge of Norwegian household demand for a set of food groups, with emphasis on price responses, using two...

Based on sectoral National accounts data and estimates of the implicit rental rate of capital, we calculate price mark-ups for 42 Norwegian industries for the period 1980-2019. The results indicate a broad-based increase in mark-ups over the sample period, with an average increase of roughly 20...

This paper provides an empirical assessment of the power of forward guidance at different horizons, shedding new light on the strength of the "forward guidance puzzle". Our identification strategy allows us to disentangle the change in future interest rates stemming from deviations from the...

The output gap (measuring the deviation of output from its potential) is a crucial concept in the monetary policy framework, indicating demand pressure that generates inflation. The output gap is also an important variable in itself, as a measure of economic fluctuations. However, its definition...

The output gap is a crucial concept in the monetary policy framework, indicating demand pressure that generates inflation. However, its definition and estimation raise a number of theoretical and empirical questions. This paper evaluates a series of univariate and multivariate methods for...

We estimate a small open-economy DSGE model for Norway with two specifications of monetary policy: a simple instrument rule and optimal policy based on an intertemporal loss function. The empirical fit of the model with optimal policy is as good as the model with a simple rule. This result is...

Based on high-frequency data for Norway and Sweden, we investigate to what extent explicit forward guidance from monetary policy makers, by means of publishing the path of expected future policy rates, affects the market yield curve. We summarise movements in the yield curve by two latent...

Over the last decade monetary policy in Norway has gradually evolved from exchange rate targeting to flexible inflation targeting. In addition, globalization has affected the Norwegian economy substantially over the last decade. Monetary policy has increasingly been challenged on how to respond...