The output gap plays an important role in the assessment and conduct of monetary policy. Most of the current literature, however, relies on filtering procedures which use ad hoc smoothness arguments for identification. Furthermore, they are subject to end-of-sample problems and do not provide...

What drives the output gap? Contrary to standard agnostic statistical approaches, New Keynesian small open economy models allow decomposing the output gap into its shocks and confirm the conventional wisdom that most of the variation is due to foreign shocks. However, the risk premium shock also...

This paper constructs a theoretical model to show how the credibility of a country s commitment to an international gold standard regime is driven by fundamental determinants such as: 1) shifts in domestic policy, 2) a breakdown in cooperation between central banks, and 3) unilateral...

Immigration to Germany has increased significantly since 2011, primarily due to the immigration of citizens from other euro area countries and those which joined the EU in 2004 and 2007. This increase is mainly attributable to a lack of immigration barriers and the good economic situation on the...

Die Zuwanderung nach Deutschland ist seit 2011 stark gestiegen, hauptsächlich durch Zuzüge von Bürgerinnen und Bürgern aus den in den Jahren 2004 und 2007 der EU beigetretenen Ländern und anderen Ländern des Euroraums. Der Abbau von Zuwanderungshindernissen und die konjunkturell bedingt...

Time-varying volatility plays a crucial role in understanding business cycles in emerging market economies. However, the literature treats volatility as an exogenous process. This paper endogenizes time-varying volatility in the debt premium and total factor productivity into a standard small...

To what extent is the international business cycle affected by the fact that an essential input (oil) is traded on the world market? We quantify the contribution of oil by setting up a model with separate shocks to efficiencies of capital/labor and oil, as well as global shocks to the oil...

This paper analyses the role of real and nominal shocks in explaining business cycles in a small open economy like that of Norway. In particular, we study the sources behind real exchange rate fluctuations since the collapse of the Bretton Woods agreement. Imposing long run restrictions implied...