Simple unemployment model and policy functions

Dear Pfeifer

  1. I am looking for a paper in the literature that measures the elasticity of the unemployment rate to a change in the monetary policy rate. Do you know of any small structural or semi-structural model where I can study this and apply it to the particular case of my country?

  2. I would like to know what is the appropriate way to interpret the coefficients of the policy functions, I attach a small example. Are they interpreted in the same way as the OLS estimators or is it different?


  1. See e.g.
    Gertler et al. 2008 - An Estimated Monetary DSGE Model with Unemployment and Staggered Nominal Wage Bargaining at
  2. In contrast to OLS, the policy functions show causal effects. Apart from that, the interpretations is the same.