2  Potential output and monetary policy in New Zealand is discussed at length in McDermott, J (2014), “Realising our potential: Potential output and the monetary policy framework”, Speech by John McDermott, Assistant Governor and Chief Economist, Reserve Bank of New Zealand, 9 July. 3  McDermott (2015), op cit.
4  These frictions are modelled in more detail for New Zealand in Albertini, J, Kamber, G and Kirker, M (2012), “An estimated small open economy model with frictional unemployment”, Pacific Economic Review, 17(2): 326–353.