Comparing the New Keynesian Phillips Curve with time series models to forecast inflation
نویسندگان
چکیده
منابع مشابه
Inflation Dynamics and the New Keynesian Phillips Curve
www.philadelphiafed.org to the financial instruments that help guard savings from being eroded by inflation.1 Also, households and firms often write contracts that are stated in dollar amounts (nominal terms). A worker may, for example, sign a contract to work over the upcoming year for a fixed dollar amount. If inflation turns out to be higher than what was expected at the time the contract wa...
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The New-Keynesian Phillips curve is usually reported to fit the data better when lagged inflation, and therefore backward-looking price setting, is included in the equation. We argue that the same inflation persistence can be generated by letting the shocks in the economy be highly correlated in a model where price setting is purely forward-looking. Previous estimates in the literature are bias...
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Estimating the micro-founded New Keynesian Phillips Curve using rational inflation expectation proxies has often found that the output gap is not a valid measure of inflation pressure. This paper investigates the empirical success of the NKPC in explaining US inflation, using observed measures of inflation expectations and taking account of serial correlation in the stylized NKPC. Contrary to r...
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I n most industrialized economies, periods of above average inflation tend to be associated with above average economic activity, for example, as measured by a relatively low unemployment rate. This statistical relationship, known as the Phillips curve, is sometimes invoked when economic commentators suggest that monetary policy should not try to suppress signs of inflation. But this interpreta...
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I n most industrialized economies inflation tends to be pro-cyclical; that is, inflation is high during times of high economic activity. When economic activity is measured by the unemployment rate this statistical relationship is known as the Phillips curve. The Phillips curve is sometimes viewed as a menu for monetary policymakers, that is, they can choose between high inflation and low unempl...
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ژورنال
عنوان ژورنال: The North American Journal of Economics and Finance
سال: 2010
ISSN: 1062-9408
DOI: 10.1016/j.najef.2008.12.001