A regional analysis of inflation dynamics in Turkey
AbstractA hybrid new Keynesian Phillips curve is estimated with spatial interaction effects among the dependent and the independent variables using data of 67 provinces across Turkey over the period 1987–2001. In contrast to previous studies, backward-looking behavior appears to be more or equally important than forward looking behavior. Furthermore, when the impact of this behavior is split up into a direct effect on the own province and an indirect effect on neighboring provinces, which due to employing a spatial econometric approach is possible, we find significant evidence in favor of convergence. This is an important finding since it corroborates a process of regional integration of inflation rates across Turkey, which is a precondition in the accession process of Turkey to the European Union. Copyright Springer-Verlag Berlin Heidelberg 2014
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Bibliographic InfoArticle provided by Springer in its journal The Annals of Regional Science.
Volume (Year): 52 (2014)
Issue (Month): 1 (January)
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Find related papers by JEL classification:
- C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
- E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
- R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General
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