UNIVERSITAS XXI- ECONÓMICO
2.4.4 Rational Rose
This last section contains additional figures and tables. Figure 3 below shows the path of medium term potential growth and its contributions.
1985 1990 1995 2000 2005
−2 0 2 4
a - Canada
1980 1985 1990 1995 2000 2005 0
2 4
b - Euro area
1970 1980 1990 2000
−2
1970 1980 1990 2000 0
2 4 6
d - Germany
1970 1980 1990 2000 0
2 4 6
e - Germany-WR
1970 1980 1990 2000
0 2 4 6
f - Italy
1970 1980 1990 2000
0 5 10
g - Japan
1970 1980 1990 2000
0 2 4 6
h - Netherlands
1970 1980 1990 2000
−2 0 2 4
i - United Kingdom
1970 1980 1990 2000 0
2 4
j - United States
Legend : ( ) medium term potential growth, ( ) capital stock, (- - -) labour, (-· - · -) TFP, and ( ) age of MES capital stock.
Figure 3: Medium term potential growth and contributions
Figure 4 below shows the path of long term potential growth and its contributions.
1985 1990 1995 2000 2005
−2 0 2
a - Canada
1980 1985 1990 1995 2000 2005 0
1970 1980 1990 2000
0 2 4 6
c - France
1970 1980 1990 2000
−2 0 2 4
d - Germany
1970 1980 1990 2000
−2 0 2 4
e - Germany-WR
1970 1980 1990 2000
−2
1970 1980 1990 2000
0
1970 1980 1990 2000
0 5 10
h - Netherlands
1970 1980 1990 2000
0 2 4
i - United Kingdom
1970 1980 1990 2000 0
2 4
j - United States
Legend : ( ) long term potential growth, ( ) relative prices, (- - -) labour, and (-· -) TFP.
Figure 4: Long term potential growth and contributions
Figure 5 below shows the path of medium term potential growth and its contri-butions, including US relative prices correction.
1985 1990 1995 2000 2005
−2 0 2 4
a - Canada
1980 1985 1990 1995 2000 2005
−2 0 2 4
b - Euro area
1970 1980 1990 2000
0 2 4 6
c - France
1970 1980 1990 2000 0
2 4
d - Germany
1970 1980 1990 2000 0
2 4 6
e - Germany-WR
1970 1980 1990 2000
0 2 4 6
f - Italy
1970 1980 1990 2000
0 5 10 15
g - Japan
1970 1980 1990 2000
0 2 4 6
8 h - Netherlands
1970 1980 1990 2000
−2 0 2 4
i - United Kingdom
Legend : ( ) medium term potential growth, ( ) capital stock, (- - -) labour, (-· - · -) TFP, and ( ) age of MES capital stock.
Figure 5: Medium term potential growth and contributions (US relative prices correction)
Figure 6 below shows the path of long term potential growth and its contributions, including US relative prices correction.
1985 1990 1995 2000 2005
−1
1980 1985 1990 1995 2000 2005 0
2 4
b - Euro area
1970 1980 1990 2000
0 2 4 6
c - France
1970 1980 1990 2000 0
2 4
d - Germany
1970 1980 1990 2000 0
2 4 6
e - Germany-WR
1970 1980 1990 2000
0 2 4 6
f - Italy
1970 1980 1990 2000
0 2 4 6
g - Japan
1970 1980 1990 2000
0
1970 1980 1990 2000
0 2 4
i - United Kingdom
Legend : ( ) long term potential growth, ( ) relative prices, (- - -) labour, and (-· -) TFP.
Figure 6: Long term potential growth and contributions (US relative prices correction)
Part1:Sourcesofmediumtermpotentialoutputgrowth Period1991–1995Period1995–2000Period2000–2004 Contributions)ContributionsContributions EconomyGrowthCapitalLabourTFPAgeGrowthCapitalLabourTFPAgeGrowthCapitalLabourTFPAge Canada2.11.10.40.50.13.21.11.10.50.63.01.20.90.50.4 Euroarea2.30.90.01.30.12.00.80.30.80.12.20.90.40.70.2 France1.81.00.01.3-0.52.20.80.41.3-0.32.00.9-0.21.30.1 Germany2.30.90.11.30.01.80.8-0.31.30.02.00.7-0.11.30.0 Germany-WR2.51.10.11.20.01.91.0-0.31.20.01.90.8-0.11.20.0 Italy1.40.8-0.71.5-0.21.40.70.10.60.01.10.80.5-0.30.1 Japan2.31.3-0.11.5-0.31.30.9-0.41.5-0.70.60.7-0.61.5-0.9 Netherlands2.70.81.01.0-0.13.00.91.11.00.02.60.80.81.00.0 UnitedKingdom1.90.9-0.41.4-2.80.90.41.4-2.71.00.31.4- UnitedStates2.70.90.91.0-3.61.11.01.5-3.21.20.41.6- Part2:Sourcesoflongtermpotentialoutputgrowth Period1991–1995Period1995–2000Period2000–2004 Contributions)ContributionsContributions EconomyGrowthRel.pricesPopulationTFPGrowthRel.pricesPopulationTFPGrowthRel.pricesPopulationTFP Canada2.30.41.10.82.20.21.10.82.50.51.20.8 Euroarea3.10.70.42.02.00.50.21.21.60.20.31.1 France2.70.50.31.92.50.30.31.92.50.10.51.9 Germany2.2-0.20.32.02.60.60.02.02.60.8-0.22.0 Germany-WR1.9-0.20.31.82.30.60.01.82.40.8-0.21.8 Italy3.20.60.22.41.40.40.01.0-0.30.2-0.1-0.4 Japan2.7-0.10.32.52.40.0-0.12.52.30.1-0.32.5 Netherlands2.30.20.51.52.30.40.41.52.50.40.51.5 UnitedKingdom3.20.90.12.23.20.70.42.23.40.50.72.2 UnitedStates3.20.61.01.54.10.61.22.34.50.51.42.6 Table15:Sourcesofpotentialoutputgrowth,mediumvslongterm
Part1:Sourcesofmediumtermpotentialoutputgrowth(USrelativepricescorrection) Period1991–1995Period1995–2000Period2000–2004 Contributions)ContributionsContributions EconomyGrowthCapitalLabourTFPAgeGrowthCapitalLabourTFPAgeGrowthCapitalLabourTFPAge Canada2.01.00.40.7-0.13.31.01.10.70.53.01.10.90.70.3 Euroarea2.40.90.01.20.22.20.80.30.90.32.20.80.40.50.5 France1.70.90.01.0-0.32.20.70.41.00.02.20.9-0.21.00.5 Germany2.41.60.10.80.01.71.3-0.30.80.01.60.9-0.10.80.0 Germany-WR2.61.90.10.60.01.61.5-0.30.6-0.11.51.0-0.10.6-0.1 Italy1.40.9-0.71.3-0.11.50.70.10.50.21.00.80.5-0.50.3 Japan2.31.3-0.11.5-0.31.30.9-0.41.5-0.70.60.7-0.61.5-0.9 Netherlands2.80.81.00.90.03.00.91.10.90.12.50.80.80.90.0 UnitedKingdom1.90.8-0.41.4-2.70.90.41.4-2.60.90.31.4- Part2:Sourcesoflongtermpotentialoutputgrowth(USrelativepricescorrection) Period1991–1995Period1995–2000Period2000–2004 Contributions)ContributionsContributions EconomyGrowthRel.pricesPopulationTFPGrowthRel.pricesPopulationTFPGrowthRel.pricesPopulationTFP Canada2.80.61.11.12.80.61.11.12.80.51.21.1 Euroarea2.80.50.41.92.20.50.21.41.60.50.30.8 France2.30.50.31.52.30.50.31.52.40.50.51.5 Germany2.10.50.31.21.80.50.01.21.50.5-0.21.2 Germany-WR1.80.50.30.91.50.50.0.91.20.5-0.2.9 Italy2.80.60.22.11.30.60.00.7-0.40.5-0.1-0.8 Japan2.90.40.32.12.50.4-0.12.12.30.4-0.32.1 Netherlands2.40.50.51.42.30.50.41.42.30.50.51.4 UnitedKingdom2.80.50.12.23.10.50.42.23.30.40.72.2 Table16:Sourcesofpotentialoutputgrowth,mediumvslongterm(USrelativepricescorrection)
Table 17 shows the estimated breaks on GDP potential growth trend Table 17: Breaks on GDP potential growth trend
Start date Break 1 Break 2
Canada 1962q2 1975q2(-)
Euro area 1963q2 1973q3(-)
France 1963q2 1974q1(-)
Germany 1960q2 1972q4(-)
Germany-WR 1960q2 1972q4(-)
Italy 1960q2 1973q4(-) 1989q3(-)
Japan 1970q1 1992q1(-)
United Kingdom 1960q2 1973q3(-) 1982q2(+) United States 1960q1 1966q3(-) 1996q1(+)
European Central Bank Working Paper Series
For a complete list of Working Papers published by the ECB, please visit the ECB’s website (http://www.ecb.europa.eu)
790 “Asset prices, exchange rates and the current account” by M. Fratzscher, L. Juvenal and L. Sarno, August 2007.
791 “Inquiries on dynamics of transition economy convergence in a two-country model” by J. Brůha and J. Podpiera, August 2007.
792 “Euro area market reactions to the monetary developments press release” by J. Coffi net and S. Gouteron, August 2007.
793 “Structural econometric approach to bidding in the main refi nancing operations of the Eurosystem”
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794 “(Un)naturally low? Sequential Monte Carlo tracking of the US natural interest rate” by M. J. Lombardi and S. Sgherri, August 2007.
795 “Assessing the impact of a change in the composition of public spending: a DSGE approach” by R. Straub and I. Tchakarov, August 2007.
796 “The impact of exchange rate shocks on sectoral activity and prices in the euro area” by E. Hahn, August 2007.
797 “Joint estimation of the natural rate of interest, the natural rate of unemployment, expected infl ation, and potential output” by L. Benati and G. Vitale, August 2007.
798 “The transmission of US cyclical developments to the rest of the world” by S. Dées and I. Vansteenkiste, August 2007.
799 “Monetary policy shocks in a two-sector open economy: an empirical study” by R. Llaudes, August 2007.
800 “Is the corporate bond market forward looking?” by J. Hilscher, August 2007.
801 “Uncovered interest parity at distant horizons: evidence on emerging economies & nonlinearities” by A. Mehl and L. Cappiello, August 2007.
802 “Investigating time-variation in the marginal predictive power of the yield spread” by L. Benati and C. Goodhart, August 2007.
803 “Optimal monetary policy in an estimated DSGE for the euro area” by S. Adjemian, M. Darracq Pariès and S. Moyen, August 2007.
804 “Growth accounting for the euro area: a structural approach” by T. Proietti and A. Musso, August 2007.
805 “The pricing of risk in European credit and corporate bond markets” by A. Berndt and I. Obreja, August 2007.
806 “State-dependency and fi rm-level optimization: a contribution to Calvo price staggering” by P. McAdam and A. Willman, August 2007.
810 “Infl ation persistence: euro area and new EU Member States” by M. Franta, B. Saxa and K. Šmídková, September 2007.
811 “Instability and nonlinearity in the euro area Phillips curve” by A. Musso, L. Stracca and D. van Dijk, September 2007.
812 “The uncovered return parity condition” by L. Cappiello and R. A. De Santis, September 2007.
813 “The role of the exchange rate for adjustment in boom and bust episodes” by R. Martin, L. Schuknecht and I. Vansteenkiste, September 2007.
814 “Choice of currency in bond issuance and the international role of currencies” by N. Siegfried, E. Simeonova and C. Vespro, September 2007.
815 “Do international portfolio investors follow fi rms’ foreign investment decisions?” by R. A. De Santis and P. Ehling, September 2007.
816 “The role of credit aggregates and asset prices in the transmission mechanism: a comparison between the euro area and the US” by S. Kaufmann and M. T. Valderrama, September 2007.
817 “Convergence and anchoring of yield curves in the euro area” by M. Ehrmann, M. Fratzscher, R. S. Gürkaynak and E. T. Swanson, October 2007.
818 “Is time ripe for price level path stability?” by V. Gaspar, F. Smets and D. Vestin, October 2007.
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820 “What do we really know about fi scal sustainability in the EU? A panel data diagnostic” by A. Afonso and C. Rault, October 2007.
821 “Social value of public information: testing the limits to transparency” by M. Ehrmann and M. Fratzscher, October 2007.
822 “Exchange rate pass-through to trade prices: the role of non-linearities and asymmetries” by M. Bussière, October 2007.
823 “Modelling Ireland’s exchange rates: from EMS to EMU” by D. Bond and M. J. Harrison and E. J. O’Brien, October 2007.
824 “Evolving U.S. monetary policy and the decline of infl ation predictability” by L. Benati and P. Surico, October 2007.
825 “What can probability forecasts tell us about infl ation risks?” by J. A. García and A. Manzanares, October 2007.
826 “Risk sharing, fi nance and institutions in international portfolios” by M. Fratzscher and J. Imbs, October 2007.
827 “How is real convergence driving nominal convergence in the new EU Member States?”
by S. M. Lein-Rupprecht, M. A. León-Ledesma and C. Nerlich, November 2007.
Date: 14 Nov, 2007 17:48:00;Format: (420.00 x 297.00 mm);Output Profile: SPOT IC300;Preflight: Failed!