RBNZ paper identifies disconnect between labour markets and rest of economy

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A Reserve Bank of New Zealand study published on Friday finds a strong disconnect between labour markets and the rest of the economy in macroeconomic models.

The paper's authors, Julien Albertini, Güneş Kamber and Michael Kirker, use a structural small open economy model that incorporates standard search and matching frictions to investigate labour market dynamics in New Zealand, to better understand the driving forces behind labour market variables.

In particular, the authors are interested in

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