We analyze real interest rate convergence among six industrialized countries in between 1975M1-2011M3 within a multi-country framework by means of a dynamic latent factor model. The real interest rates are decomposed into permanent and transitory factors, and country-specific components....

Several empirical studies have suggested that the Bundesbank has pursued inflation targets rather than monetary targets. These studies have been criticized because they do not adequately measure the deviation from target and because they use some short term interest rate as a measure of the...

In the long history of rising and persistent unemployment in Europe almost all institutions – employment protection legislation, unions, wages, wage structure, unemployment insurance, etc. – have been alleged and found guilty to have caused this tragic development at some point in time....

Nahezu alle Institutionen –Kündigungsschutz, Gewerkschaften, Lohnspreizung, Arbeitslosenversicherung etc.- wurde verdächtigt und schuldig gesprochen die tragische Entwicklung der Arbeitslosigkeit in Europa verursacht zu haben. US-amerikanische Arbeitsmarktinstitutionen wurden zum Benchmark...

Whereas previous studies have focused on the causal relation between nominal interest rates, this paper examines causal relationships between real rates for the United States and six other countries. Based on evidence from our full sample, we find that U.S. and foreign interest rates are not...