Series: Working Papers. 1720.
Author: Luis J. Álvarez and Ana Gómez-Loscos.
Topics: Quantitative methods | Non-financial corporations, businesses | Productivity | Basel Committee | Prices and margins | Inflation.
Published in: Journal of Policy Modelling, Volume 40, Issue 4, July–August 2018, Pages 827-850
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Abstract
This paper presents a survey of output gap modeling techniques, which are of special interest for policy making institutions. We distinguish between univariate -which estimate trend output on the basis of actual output, without taking into account the information contained in other variables–, and multivariate methods –which incorporate useful information on some other variables, based on economic theory. We present the main advantages and drawbacks of the different methods.