IDEAS home Printed from https://ideas.repec.org/p/men/wpaper/05_2011.html
   My bibliography  Save this paper

Inflation Perception and Anticipation Gaps in the Eurozone

Author

Listed:
  • Svatopluk Kapounek

    () (Department of Finance, Faculty of Business and Economics, Mendel University in Brno)

  • Lubor Lacina

    () (Department of Finance, Faculty of Business and Economics, Mendel University in Brno)

Abstract

There is significant empirical evidence that the introduction of the euro led to a significant increase of perceived inflation in most countries. Such an increase and persistence in the perceived inflation might then have an impact on inflation expectations and other macroeconomic variables. The authors have used the short-term Phillips curve to describe the difference between inflation expectations and its current values, subsequently to identify the impact of this difference on other economic indicators. The paper is structured as follows: Section 1 provides an overview of the theory and empiricism on the gap between measured and perceived inflation. Section 2 then builds up the theoretical framework based on the short-term Phillips curve approach and derives two hypotheses, to be tested subsequently. Section 3 provides the methodology. Section 4 presents the modelling and results of the empirical analysis. In section 5 authors compare its results and used methodology with papers and studies on a similar topic. Finally, Section 6 concludes and provides recommendations for the economic policy.

Suggested Citation

  • Svatopluk Kapounek & Lubor Lacina, 2011. "Inflation Perception and Anticipation Gaps in the Eurozone," MENDELU Working Papers in Business and Economics 2011-05, Mendel University in Brno, Faculty of Business and Economics.
  • Handle: RePEc:men:wpaper:05_2011
    as

    Download full text from publisher

    File URL: http://ftp.mendelu.cz/RePEc/men/wpaper/05_2011.pdf
    File Function: Full text
    Download Restriction: no

    References listed on IDEAS

    as
    1. Lizal, Lubomir & Kocenda, Evzen, 2001. "State of corruption in transition: case of the Czech Republic," Emerging Markets Review, Elsevier, pages 138-160.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    monetary integration; perceived and anticipated inflation; adaptive and rational expectations hypothesis; expectations-augmented Phillips curve; stationarity; ADF test;

    JEL classification:

    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:men:wpaper:05_2011. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Luděk Kouba). General contact details of provider: http://edirc.repec.org/data/femencz.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.