Inflation Convergence and the New Keynesian Phillips Curve in the Czech Republic

[img]
Preview
PDF
Language: English
153Kb
Title:Inflation Convergence and the New Keynesian Phillips Curve in the Czech Republic
Creators:
Danišková, Katarína
Fidrmuc, Jarko
Journal or Publication Title:
AUCO Czech Economic Review, 5, 2, pp. 99-115
Uncontrolled Keywords:Inflation, New Keynesian Phillips Curve, marginal costs, output gap, real unit labour costs

Abstract

The New Keynesian Phillips Curve has become an important part of modern monetary policy models. It describes the relationship between inflation and real marginal cost, which is derived from micro-founded models with rational expectations, sticky prices, and forward and backward looking behaviour. This answers the previous critique of the Phillips Curve. We estimate several specifications of the New Keynesian Phillips Curve for the Czech Republic between 1996 and 2009. We show that the GMM suffers under the problem of weak instruments leading to biased estimates. In turn, the FIML is robust and yields significant estimates of structural parameters implying a strong forward looking behaviour.

Official URL: http://www.ceeol.com/aspx/issuedetails.aspx?issueid=F7AA27BA-1FA2-4B2D-80EA-586F10A7D291&articleid=08AE801A-928C-477F-BA38-03CF385B5334

Title:Inflation Convergence and the New Keynesian Phillips Curve in the Czech Republic
Creators:
Danišková, Katarína
Fidrmuc, Jarko
Uncontrolled Keywords:Inflation, New Keynesian Phillips Curve, marginal costs, output gap, real unit labour costs
Subjects:H Social Sciences > HB Economic Theory
H Social Sciences > HG Finance
H Social Sciences > HF Commerce
Divisions:Section of external journals > AUCO Czech Economic Review
Journal or Publication Title:AUCO Czech Economic Review
Volume:5
Number:2
Page Range:pp. 99-115
ISSN:1802-4696
Publisher:Charles University
Related URLs:
URLURL Type
http://auco.cuni.czPublisher
http://avi.lib.cas.cz/node/183Publisher
ID Code:6767
Item Type:Article
Deposited On:29 Aug 2011 19:17
Last Modified:29 Aug 2011 17:17

Citation

Danišková, Katarína; Fidrmuc, Jarko (2011) Inflation Convergence and the New Keynesian Phillips Curve in the Czech Republic. AUCO Czech Economic Review, 5 (2). pp. 99-115. ISSN 1802-4696

Repository Staff Only: item control page