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The main goal of the paper is to estimate the NAIRU for the Macedonian   economy and to discuss the applicability of this indicator. The paper   provides time-varying estimates for the period 1998-2012, which are obtained   using the Ball and Mankiw (2002) approach, supplemented with the iterative   procedure proposed by Ball (2009). The results reveal that the Macedonian   NAIRU has ahumpshaped path. The estimation is based on both the LFS   unemployment rate and the LFS unemployment rate corrected for employment in   the grey economy. The dynamics of the estimated NAIRU stress the ability of   the NAIRU to present the cyclical misbalances in a national economy

NAIRU estimates in a transitional economy with an extremely high unemployment rate: The case of the Republic of Macedonia