Contracting Models of the Phillips Curve: Empirical Estimates for Middle-Income Countries

24 Pages Posted: 20 Apr 2016

See all articles by Pierre-Richard Agenor

Pierre-Richard Agenor

University of Manchester - School of Social Sciences

Nihal Bayraktar

Pennsylvania State University - School of Business Administration; World Bank

Date Written: September 2003

Abstract

This paper provides empirical estimates of contracting models of the Phillips curve for four middle-income developing economies - Chile, the Republic of Korea, the Philippines, and Turkey. Following an analytical review, models with both one lead and one lag, and two lags and three leads, are then estimated using Generalized Method of Moments (GMM) techniques. The results indicate that for both Chile and Turkey past and future inflation are of about the same magnitude in affecting current inflation. In Korea past inflation has a larger impact on inflation, whereas in the Philippines it is future inflation that plays a larger role. Homogeneity restrictions are satisfied for Korea and Turkey but not for Chile and the Philippines.

This paper - a product of the Poverty Reduction and Economic Management Division, World Bank Institute - is part of a larger effort in the institute to understand the dynamics of inflation in developing countries.

Suggested Citation

Agenor, Pierre-Richard and Bayraktar, Nihal, Contracting Models of the Phillips Curve: Empirical Estimates for Middle-Income Countries (September 2003). World Bank Policy Research Working Paper No. 3139. Available at SSRN: https://ssrn.com/abstract=636559

Pierre-Richard Agenor (Contact Author)

University of Manchester - School of Social Sciences ( email )

Oxford Road
Manchester, M13 9PL
United Kingdom

Nihal Bayraktar

Pennsylvania State University - School of Business Administration ( email )

777 West Harrisburg Pike
Middletown, PA 17057-4898
United States
+1 717 948 6142 (Phone)

HOME PAGE: http://www.personal.psu.edu/nxb23/

World Bank

1818 H Street, N.W.
Washington, DC 20433
United States

Register to save articles to
your library

Register

Paper statistics

Downloads
130
Abstract Views
1,071
rank
223,070
PlumX Metrics