Journal Article

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

Abstract

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

Citation

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. http://dx.doi.org/10.5018/economics-ejournal.ja.2008-23

Assessment

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Citations (@RePEc): 10
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Comments and Questions


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

see PDF attached


Egmont Kakarot-Handtke - New Phillips curve
September 25, 2014 - 16:49

Ultra-new Keynesian Phillips curve
Proposal/question/challenge to Roger Bjørnstad and Ragnar Nymoen

I have developed a Phillips curve from purely objective axiomatic foundations (2012, p. 14, eq. (33)). I wonder whether you have an interest and appropriate data to test it.

Sincerely
Egmont Kakarot-Handtke

References
Kakarot-Handtke, ...[more]

... E. (2012). Keynes’s Employment Function and the Gratuitous Phillips Curve Desaster. SSRN Working Paper Series, 2130421: 1–19. URL http://ssrn.com/abstract=2130421.


Egmont Kakarot-Handtke - New Phillips curve (with reference-link)
September 29, 2014 - 12:37

Ultra-new Keynesian Phillips curve
Proposal/question/challenge to Roger Bjørnstad and Ragnar Nymoen

See PDF with reference-link

EKH