The Distribution Analysis of the Inflation Components of Turkey
AbstractThis paper investigates distribution of inflation items using various measures of skewness and kurtosis for Turkey covering the period 1996-2007. Considering sensitivity of traditional distribution measures to outlying observations robust skewness and kurtosis are also computed as a novelty. Analysis results mainly reveal that inflation components are right skewed and fat tailed as documented by the previous studies. However due to possible effects of the outliers traditional measures, in particular skewness, are lagging behind the robust measures in identifying underlying dispersion. Therefore one can say that weighted mean inflation used to measure general price changes is not trustworthy and a biased estimator of central location. Our results further suggest that core measures based on constant and symmetric trimming applied by the previous studies for Turkey is somewhat deficient since skewness of the data is ignored in the estimation process. Therefore, to obtain more reliable information in monitoring general price movements we suggest use of asymmetric trimmed means estimators which allows trimming different percentages from each tail of the distribution.
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Bibliographic InfoPaper provided by Ege University, Department of Economics in its series Working Papers with number 0902.
Length: 11 pages
Date of creation: Sep 2009
Date of revision:
Infation; Prices; Distribution; Robust Skewness; Robust; Kurtosis.;
Find related papers by JEL classification:
- C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
- E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
- E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-10-03 (All new papers)
- NEP-ARA-2009-10-03 (MENA - Middle East & North Africa)
- NEP-CBA-2009-10-03 (Central Banking)
- NEP-CWA-2009-10-03 (Central & Western Asia)
- NEP-MON-2009-10-03 (Monetary Economics)
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