Planas, Christophe; Roeger, Werner; Rossi, Alessandro - Directorate-General Economic and Financial Affairs, … - 2010
In the production function approach, accurate output gap assessment requires a careful evaluation of the TFP cycle. In this paper we propose a bivariate model that links TFP to capacity utilization and we show that this model improves the TFP trend-cycle decomposition upon univariate and...