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A Mark-Up Model of Inflation for Morocco

Author

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  • Hicham Bennouna

    (Department of economics-University Mohamed V, Rabat-Agdal, Morocco.)

Abstract

We follow Brouwer and Ericsson (1998) approach in order to estimate a mark-up model of price over unit costs in Morocco from 1997q1 to 2013q2. This kind of models assumes that the equilibrium price level is set as a markup on some combination of input prices. Therefore, by estimating the short-run and long-run price elasticities with respect to unit labor costs and import prices, it's possible to calculate the impact of supply shocks related to production costs. This treatment of price dynamics is at the heart of the modern approach to modelling inflation, both for forecasting and for policy analysis. The mark-up model identified in this paper highlight the fact that unit labor costs and import prices are key factors in the price setting strategy of the Moroccan firms.

Suggested Citation

  • Hicham Bennouna, 2015. "A Mark-Up Model of Inflation for Morocco," International Journal of Economics and Financial Issues, International Journal of Economics and Financial Issues, vol. 5(1), pages 281-287.
    • Handle: RePEc:eco:journ1:2015-01-23
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    References listed on IDEAS

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    Cited by:

    1. Boris I. Alekhin, 2023. "Interregional Differences in Inflation through the Prism of Ackley’s Theory," Finansovyj žhurnal — Financial Journal, Financial Research Institute, Moscow 125375, Russia, issue 1, pages 8-25, February.
    2. Hale Akbulut, 2022. "Forecasting inflation in Turkey: A comparison of time-series and machine learning models," Economic Journal of Emerging Markets, Universitas Islam Indonesia, vol. 14(1), pages 55-71.

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    More about this item

    Keywords

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    JEL classification:

    • E50 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - General
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies

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