Sign in to use this feature.

Years

Between: -

Subjects

remove_circle_outline
remove_circle_outline
remove_circle_outline
remove_circle_outline
remove_circle_outline
remove_circle_outline

Journals

Article Types

Countries / Regions

Search Results (7)

Search Parameters:
Keywords = New Keynesian Phillips curve

Order results
Result details
Results per page
Select all
Export citation of selected articles as:
26 pages, 1624 KiB  
Article
Openness, Unionized Labor Markets, and Monetary Policy
by Xakousti Chrysanthopoulou, Evangelos Ioannidis and Moïse Sidiropoulos
Mathematics 2025, 13(7), 1181; https://doi.org/10.3390/math13071181 - 3 Apr 2025
Viewed by 561
Abstract
This paper extends the micro-founded DSGE open economy model by incorporating unionized labor markets. Unlike the standard framework with atomistic unions, large labor unions consider broader economic conditions and internalize the impact of their wage settlements on the aggregate economy. By emphasizing the [...] Read more.
This paper extends the micro-founded DSGE open economy model by incorporating unionized labor markets. Unlike the standard framework with atomistic unions, large labor unions consider broader economic conditions and internalize the impact of their wage settlements on the aggregate economy. By emphasizing the interplay between internal and external sources of economic distortions and monetary policy regimes, we demonstrate that the economy’s openness, the degree of wage-setting centralization, and different monetary policy regimes influence unions’ wage-setting behavior and macroeconomic outcomes. The analysis identifies three key effects—the monetary policy effect, the intertemporal substitution effect, and the open economy effect—that large unions internalize when adjusting their wage demands in response to policy actions and external conditions. This novel wage-based mechanism alters the New Keynesian Phillips curve, with implications for the conduct of monetary policy, particularly in shaping the economy’s response to shocks and equilibrium determinacy. The real effects of monetary policy shocks under different policy settings depend on large unions’ internalization effect. In a unionized labor market, the impact of monetary shocks on the real economy is amplified compared to the standard case with atomistic unions. Additionally, interactions among large unions, openness, and monetary policy regimes affect determinacy properties of equilibrium (i.e., uniqueness of the solution path) under various forms and timing of monetary policy rules. This paper offers new insights into how union coordination interacts with monetary policy regimes and trade openness to shape macroeconomic stability (uniqueness of rational expectations equilibrium) and the dynamic response of the economy to shocks. These findings enhance our understanding of monetary policy design in economies with strong large labor institutions and external trade exposure—an area that remains underexplored in the existing DSGE literature. Full article
(This article belongs to the Special Issue Latest Advances in Mathematical Economics)
Show Figures

Figure 1

12 pages, 277 KiB  
Article
On the Low Degree of Entropy Implied by the Solutions of Modern Macroeconomic Models
by Ragnar Nymoen
Entropy 2022, 24(12), 1728; https://doi.org/10.3390/e24121728 - 25 Nov 2022
Viewed by 1511
Abstract
The non-causal (“forward-looking”) solution used routinely in academic macroeconomics may represent a violation of a law of entropy, namely that the direction of time is one way (from the past and towards the present), and that the variance of economic processes increases with [...] Read more.
The non-causal (“forward-looking”) solution used routinely in academic macroeconomics may represent a violation of a law of entropy, namely that the direction of time is one way (from the past and towards the present), and that the variance of economic processes increases with time. In order to re-establish a degree of compatibility with the law of entropy, so called hybrid forms are required add-ins to DSGE (Dynamic Stochastic General Equilibrium) models. However, the solution that uses hybrid forms is a particular special case of a causal solutions of autoregressive distributed lags, VARs and recursive and simultaneous equations models well known from empirical macro econometrics. Hence, hybrid forms of small scale DSGE models can be analysed and tested against competing model equations, using an econometric encompassing framework. Full article
(This article belongs to the Special Issue Granger Causality and Transfer Entropy for Financial Networks)
Show Figures

Figure 1

18 pages, 1268 KiB  
Article
Do Inflation Expectations Matter for Small, Open Economies? Empirical Evidence from the Solomon Islands
by Angeline B. Rohoia and Parmendra Sharma
J. Risk Financial Manag. 2021, 14(9), 448; https://doi.org/10.3390/jrfm14090448 - 17 Sep 2021
Cited by 1 | Viewed by 3594
Abstract
This paper examines the role of inflation expectations in Solomon Islands, a Pacific Island Country, using the Hybrid New Keynesian Phillips Curve model. The study applies the Generalized Method of Moments to estimate the Hybrid New Keynesian Philips Curve model using quarterly time [...] Read more.
This paper examines the role of inflation expectations in Solomon Islands, a Pacific Island Country, using the Hybrid New Keynesian Phillips Curve model. The study applies the Generalized Method of Moments to estimate the Hybrid New Keynesian Philips Curve model using quarterly time series data for the period 2003–2017. The study confirms the existence of a Hybrid New Keynesian Philips Curve for Solomon Islands and finds that both backward-looking and forward-looking processes matter for inflation. Fuel prices and output gap are important indicators of current inflation. The study highlights key areas to further investigate including the weak monetary transmission mechanism and to examine the exchange rate pass through effect onto domestic prices. Studies on the role of inflation expectations in small, open, economies of the Pacific, such as Solomon Islands, is limited. This paper fills this void in literature by using quarterly time-series data to build a Hybrid New Keynesian Philips Curve model for Solomon Islands. Full article
Show Figures

Figure 1

9 pages, 257 KiB  
Article
Movement of Inflation and New Keynesian Phillips Curve in ASEAN
by Adhitya Wardhono, M. Abd. Nasir, Ciplis Gema Qori’ah and Yulia Indrawati
Economies 2021, 9(1), 34; https://doi.org/10.3390/economies9010034 - 10 Mar 2021
Cited by 6 | Viewed by 4123
Abstract
The development of the theory of dynamic inflation begins by linking wage inflation and unemployment. In further developments, factor of expectation is classified into inflation model. The study used inflation data is important for ASEAN, because ASEAN is one of the strengths of [...] Read more.
The development of the theory of dynamic inflation begins by linking wage inflation and unemployment. In further developments, factor of expectation is classified into inflation model. The study used inflation data is important for ASEAN, because ASEAN is one of the strengths of the international economy. This study analyzes the dynamics of inflation in the ASEAN using framework the New-Keynesian Phillips Curve (NKPC) model. The data used is the quarterly panel data from 5 ASEAN members in the period 2005.QI–2018.QIV. The study of this dynamic inflation applies quarter to quarter inflation data, meaning that the inflation rate is the percentage change in the general price of the current quarter compared to last quarter general price divided by the last quarter. The empirical results are estimated by using the Generalized Method of Moment (GMM), both of the system and first different indicates that the pattern formation of inflation expectations are backward-looking and forward-looking. In addition, the estimated NKPC models show the backward-looking behavior is more dominant than the forward looking. Changes in inflation are not entirely influenced by expectations of inflation in each country. Changes in inflation are also influenced by the output gap, changes in money supply, and exchange rate. Based on the findings of this study, it can be concluded that the NKPC models can explain the dynamics of inflation in each country in the ASEAN region. Full article
19 pages, 897 KiB  
Review
Review of Kalman Filter Employment in the NAIRU Estimation
by Katerina Fronckova, Pavel Prazak and Ivan Soukal
Systems 2019, 7(3), 33; https://doi.org/10.3390/systems7030033 - 28 Jun 2019
Cited by 1 | Viewed by 7130
Abstract
The aim of the paper is to provide a recent overview of Kalman filter employment in the non-accelerating inflation rate of unemployment (NAIRU) estimation. The NAIRU plays a key part in an economic system. A certain unemployment rate which is consistent with a [...] Read more.
The aim of the paper is to provide a recent overview of Kalman filter employment in the non-accelerating inflation rate of unemployment (NAIRU) estimation. The NAIRU plays a key part in an economic system. A certain unemployment rate which is consistent with a stable rate of inflation is one of the conditions for economic system stability. Since the NAIRU cannot be directly observed and measured, it is one of the most fitting problems for the Kalman filter application. The search for original, NAIRU focused and Kalman filter employment studies was performed in three scientific databases: Web of Science, Scopus, and ScienceDirect. A sample of 152 papers was narrowed down to 25 studies, which were described in greater detail regarding the focus, methods, model features, limitations, and other characteristics. A group of studies using a purely statistical approach of decomposing unemployment into a trend and cyclical component was identified. The next group uses the reduced-form approach which is sometimes combined with statistical decomposition. In such cases, the models are usually based on the backward-looking Phillips curve. Nevertheless, the forward-looking, New Keynesian or rarely hybrid New Keynesian variant can also be encountered. Full article
(This article belongs to the Special Issue Mathematical Models of Economic Systems)
Show Figures

Figure 1

20 pages, 360 KiB  
Article
Estimating Unobservable Inflation Expectations in the New Keynesian Phillips Curve
by Francesca Rondina
Econometrics 2018, 6(1), 6; https://doi.org/10.3390/econometrics6010006 - 5 Feb 2018
Cited by 4 | Viewed by 9130
Abstract
This paper uses an econometric model and Bayesian estimation to reverse engineer the path of inflation expectations implied by the New Keynesian Phillips Curve and the data. The estimated expectations roughly track the patterns of a number of common measures of expected inflation [...] Read more.
This paper uses an econometric model and Bayesian estimation to reverse engineer the path of inflation expectations implied by the New Keynesian Phillips Curve and the data. The estimated expectations roughly track the patterns of a number of common measures of expected inflation available from surveys or computed from financial data. In particular, they exhibit the strongest correlation with the inflation forecasts of the respondents in the University of Michigan Survey of Consumers. The estimated model also shows evidence of the anchoring of long run inflation expectations to a value that is in the range of the target inflation rate. Full article
Show Figures

Figure 1

12 pages, 470 KiB  
Article
The Nonlinearity of the New Keynesian Phillips Curve: The Case of Tunisia
by Imen Kobbi and Foued-Badr Gabsi
Economies 2017, 5(3), 24; https://doi.org/10.3390/economies5030024 - 7 Jul 2017
Cited by 9 | Viewed by 7101
Abstract
This article seeks to check the nonlinearity of the Phillips curve in Tunisia for the 1993–2012 period, relying on a hybrid new Keynesian Phillips curve modeled via a Logistic Smooth Transition Regression (LSTR) model with endogenous variables. We estimate this model using the [...] Read more.
This article seeks to check the nonlinearity of the Phillips curve in Tunisia for the 1993–2012 period, relying on a hybrid new Keynesian Phillips curve modeled via a Logistic Smooth Transition Regression (LSTR) model with endogenous variables. We estimate this model using the nonlinear instrumental variables. The empirical results corroborate the new Keynesian assumption ofprice rigidity and show that the response of inflation to the output gap tends to be significant only if the inflation rate tends to be relatively high and exceeds a certain threshold. For a low inflation rate, the price rigidity dominates. This result is particularly evident in Tunisia, especially for the years following the 2011 revolution during which the elasticity of inflation rate to an excess demand has become highly important and the inflation rate experienced record levels. Full article
Show Figures

Figure 1

Back to TopTop