Journal Article
No. 2008-23 | July 23, 2008
The New Keynesian Phillips Curve Tested on OECD Panel Data


Using a panel data set for OECD countries we replicate the typical features of the New Keynesian Phillips curve models (NPCs) that have been estimated on country data. While this corroborates the NPC also on the macro panel data set, a different conclusion is reached when we test whether the NPC encompasses an existing model of inflation which is without feed-forward terms, but which allows for other adjustment factors than the NPC. We find that the NPC’s expected rate of future inflation and real marginal costs are weak explanatory variables, and that their statistical significance in the typical NPC is due to correlation with the equilibrium correction terms that are implied by the existing inflation model. Our results are in line with the relatively few encompassing studies that exist on country and area data.

JEL Classification:

C23, C52, E12, E31



Cite As

Roger Bjørnstad and Ragnar Nymoen (2008). The New Keynesian Phillips Curve Tested on OECD Panel Data. Economics: The Open-Access, Open-Assessment E-Journal, 2 (2008-23): 1–18.

Comments and Questions

Stefano FACHIN - Comment on panel cointegration tests applied
July 24, 2008 - 12:18

see PDF attached

Egmont Kakarot-Handtke - Ultra-new Keynesian Phillips curve
October 08, 2014 - 12:23

See PDF attached