About the sources of the inflation persistence in Russia
AbstractThe standard way to obtain the equation of New Keynesian Phillips curve is to linearize the equilibrium conditions of the Calvo model around a steady state with zero inflation. This approach is appropriate only in the low-inflation economics. This paper considers New Keynesian Phillips curve derived by linearizing the same equilibrium conditions around the time varying inflation trend. This model explains observed inflation persistence in different way and gives the different view on the ratio of agents with backward- and forward-looking expectations. In the paper estimated New Keynesian Phillips curve with time varying coefficients. This model shows that in Russia exist at least two sources of the inflation persistence.
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Bibliographic InfoPaper provided by Gaidar Institute for Economic Policy in its series Working Papers with number 0016.
Length: 14175 words
Date of creation: 2012
Date of revision: 2012
: New Keynesian Phillips Curve; backward- and forward-looking expectations; inflation persistence; Bayesian VAR;
Find related papers by JEL classification:
- E12 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Keynes; Keynesian; Post-Keynesian
- 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-2012-07-23 (All new papers)
- NEP-CIS-2012-07-23 (Confederation of Independent States)
- NEP-MAC-2012-07-23 (Macroeconomics)
- NEP-MON-2012-07-23 (Monetary Economics)
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