My question is about NAIRU (Non-Accelerating Inflation Rate of Unemployment) and its relevance with respect to the European Central Bank's monetary policy.
I have read somewhere that Philips Curve have been discredited because they are considered too simplistic. Is that the case for NAIRU as well? As I understand it, NAIRU estimates can have catastrophic error factors. Are economist capable of estimating it reliably?
Bonus points if you can provide some practical context about its relevance (or lack thereof) with respect to the eurozone. Or orient me to resources that would help.
1 Ball, L., & Mankiw, N. G. (2002). The NAIRU in theory and practice. Cambridge, MA: National Bureau of Economic Research.