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The Costs of NAIRUvianism

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  • Servaas Storm
  • C. Naastepad

Abstract

The widespread belief in the natural rate of unemployment among economists has been extraordinary. Debate is more over why it fluctuates than whether policy should use it as a target. But these Dutch economists argue that allegiance to the NAIRU could well reduce potential productivity growth and therefore make inflation more likely than is necessary. Do economists have it dead wrong?

Suggested Citation

  • Servaas Storm & C. Naastepad, 2009. "The Costs of NAIRUvianism," Challenge, Taylor & Francis Journals, vol. 52(5), pages 55-76.
    • Handle: RePEc:mes:challe:v:52:y:2009:i:5:p:55-76
    DOI: 10.2753/0577-5132520504
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