Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/244538 
Year of Publication: 
2018
Series/Report no.: 
Working Paper No. 6/2018
Publisher: 
Örebro University School of Business, Örebro
Abstract: 
We use Bayesian techniques to estimate bivariate VAR models for Swedish unemployment rate and inflation. Employing quarterly data from 1995Q1 to 2017Q3 and new tools for model selection, we compare a model with time-varying parameters and stochastic volatility to a specification with constant parameters and covar-iance matrix. We find strong evidence in favour of the specification with time-varying parameters and sto-chastic volatility. Our results indicate that the Swedish Phillips curve has not been stable over time. However, our findings do not suggest that the Phillips curve has been flatter in more recent years.
Subjects: 
Inflation
Unemployment
Time-varying parameters
Stochastic volatility
JEL: 
C11
C32
E32
Document Type: 
Working Paper

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