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RBA Glossary definition for NAIRU

NAIRU – Non-accelerating inflation rate of unemployment

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Appendix A: RBA Aggregate Wage Phillips Curve Specification, Coefficients and Implied Slope

1 Aug 2021 RDP 2021-09
James Bishop and Emma Greenland
Notes: Short run; as implied by the RBA's wage Phillips curve model; uses time-varying two-sided NAIRU estimate. ... Sources: ABS; Authors' calculations. Figure A2: RBA NAIRU Estimate. Per cent of labour force, as at December 2019, quarterly.
https://www.rba.gov.au/publications/rdp/2021/2021-09/appendix-a.html

Is the Phillips Curve Still a Curve? Evidence from the Regions

31 Aug 2021 RDP 2021-09
James Bishop and Emma Greenland
t. is unemployment,. u. t. is the non-accelerating inflation rate of unemployment (NAIRU), and e. ... time fixed effects to sweep out any movements in the aggregate NAIRU over time.
https://www.rba.gov.au/publications/rdp/2021/2021-09/full.html

References

1 Aug 2021 RDP 2021-09
James Bishop and Emma Greenland
Gordon RJ (1997), ‘The Time-Varying NAIRU and Its Implications for Economic Policy’, Journal of Economic Perspectives, 11(1), pp 11–32. ... 984. Ruberl H, M Ball, L Lucas and T Williamson (2021), ‘Estimating the NAIRU in Australia’, Treasury
https://www.rba.gov.au/publications/rdp/2021/2021-09/references.html

Benchmark Linear Model

1 Aug 2021 RDP 2021-09
James Bishop and Emma Greenland
Our model also omits an explicit control for the NAIRU. Again, the region and time effects will control for permanent differences, and common changes, in the NAIRU across regions. ... The main sources of omitted variable bias that could affect our
https://www.rba.gov.au/publications/rdp/2021/2021-09/benchmark-linear-model.html

Is the Phillips Curve Still a Curve?

1 Aug 2021 RDP 2021-09
James Bishop and Emma Greenland
Any measurement error in the NAIRU will bias the estimated slope of the Phillips curve towards zero (Ball and Mazumder 2011). ... time fixed effects to sweep out any movements in the aggregate NAIRU over time.
https://www.rba.gov.au/publications/rdp/2021/2021-09/is-the-phillips-curve-still-a-curve.html

Comparison to Aggregate Models

1 Aug 2021 RDP 2021-09
James Bishop and Emma Greenland
Notes: Short run; annualised; assumes NAIRU at 4.5 per cent; the vertical position of the curves is set by assuming that when the unemployment rate equals 4.5 per cent, ... In any case, although slow-moving forces such as migration and labour mobility
https://www.rba.gov.au/publications/rdp/2021/2021-09/comparison-to-aggregate-models.html

Allowing for Kinks in the Phillips Curve

1 Aug 2021 RDP 2021-09
James Bishop and Emma Greenland
The Phillips curve will shift over time as either the NAIRU, inflation expectations or productivity growth changes. ... When the unemployment rate is equal to the NAIRU, price inflation will be equal to long-run inflation expectations.
https://www.rba.gov.au/publications/rdp/2021/2021-09/allowing-for-kinks-in-the-phillips-curve.html

Introduction

1 Aug 2021 RDP 2021-09
James Bishop and Emma Greenland
Most importantly, the nonlinear specification generated estimates for the non-accelerating inflation rate of unemployment (NAIRU) that looked more sensible than those from a linear model.
https://www.rba.gov.au/publications/rdp/2021/2021-09/introduction.html

Background on the Phillips Curve and the RBA's Modelling Approach

1 Aug 2021 RDP 2021-09
James Bishop and Emma Greenland
a Phillips curve framework that treats the NAIRU as an unobserved variable (Cusbert 2017). ... Chua and Robinson 2018) and to estimate the NAIRU (Ruberl et al 2021).
https://www.rba.gov.au/publications/rdp/2021/2021-09/background-on-the-phillips-curve-and-the-rbas-modelling-approach.html