In fact, however, such estimates can be highly misleading because the structure of the U.S. economy is highly dynamic and evolves almost continuously over time. BIS Review 35/2007  3  In particular, over the past few decades the natural unemployment rate and the path of potential output have apparently moved around quite substantially.
If we do not recognize the potential for such shifts, they can pose serious pitfalls for the conduct of monetary policy. It is difficult to gauge these structural changes even with the benefit of hindsight, and it is even more difficult to recognize such developments when they occur.