Research Article


DOI :10.26650/ISTJECON2019-0016   IUP :10.26650/ISTJECON2019-0016    Full Text (PDF)

Phillips Curve Estimation During Tranquil and Recessionary Periods: Evidence From Panel Analysis

Yhlas Soybetov

The empirical literature that covers Phillips Curve analysis during recessionary periods is notably scant. The Great Recession has rekindled a debate on the validity and stability of the Phillips Curve which is still ongoing. The basis for this debate is the observation that real activity dropped sharply without causing a drop in inflation. This paper carries out an empirical analysis for the classical expectation-augmented Phillips curve model across 41 countries from1980-2016 by distinguishing tranquil and recessionary periods separately. Based on the results of the research, the paper finds that dynamics of Phillips Curve changes during recessionary periods and the empirical relationship becomes no longer valid. These findings support the ongoing debate about the missing disinflation and collapse of the Phillips curve, but only during the recessionary periods. In the case of tranquil periods, the empirical relationship still seems to be valid. Moreover, the paper also observes that both backward-looking and forward-looking fractions of inflation gain weight and significance during recessionary periods. However, the paper remains indecisive about which exact fraction gains more weight and significance as the panel model does not incorporate these two fractions of inflation in a single hybrid framework simultaneously.

JEL Classification : C10 , E10 , E19
DOI :10.26650/ISTJECON2019-0016   IUP :10.26650/ISTJECON2019-0016    Full Text (PDF)

Sakin Dönem ve Durgunluk Dönemi Phillips Eğrisi Tahmini: Panel Analizinden Kanıtlar

Yhlas Soybetov

Resesyon dönemlerinde Phillips Eğrisi analizini kapsayan ampirik literatür oldukça azdır. Büyük Durgunluk Phillips Eğrisi’nin geçerliliği ve istikrarı üzerine halen devam etmekte olan bir tartışmayı yeniden alevlendirmiştir. Bu tartışmanın temeli ise, gerçek iktisadi faaliyetlerin keskin bir şekilde düşerken enflasyonda bir düşüşün olmamasının gözlemlenmesidir. Bu makale, sakin ve durgunluk dönemlerini ayırarak 1980’den 2016 yılına kadar 41 ülke üzerinde, beklentilerle genişletilmiş klasik Phillips Eğrisi modeli için ampirik çalışma yürütmektedir. Araştırmanın sonuçlarına dayanarak, bu makale, Phillips Eğrisi dinamiğinin durgunluk dönemlerinde değiştiğini ve ampirik ilişkinin artık geçerli olmadığını ortaya koymaktadır. Bu sonuçlar, gözlemlenemeyen enflasyon düşüşü ve Phillips eğrisinin çöküşü konusundaki süregelen tartışmaları sadece durgunluk dönemleri için desteklemektedir. Sakin iktisadi dönemlerdeki durumda ise, bu ampirik ilişkinin hala geçerli olduğu görülmektedir. Ayrıca, bu makale hem geriye dönük hem de ileriye dönük enflasyon bileşeninin durgunluk dönemlerinde ağırlık ve önem kazandığını da gözlemlemektedir. Bununla birlikte, panel modeli enflasyonun bu iki bileşenini aynı anda tek bir melez çerçeveye dâhil etmediği için bu araştırma hangi bileşenin daha fazla ağırlık ve önem kazandığı konusunda kesin bir sonuç verememektedir.

JEL Classification : C10 , E10 , E19

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APA

Soybetov, Y. (2019). Phillips Curve Estimation During Tranquil and Recessionary Periods: Evidence From Panel Analysis. Istanbul Journal of Economics, 69(1), 23-41. https://doi.org/10.26650/ISTJECON2019-0016


AMA

Soybetov Y. Phillips Curve Estimation During Tranquil and Recessionary Periods: Evidence From Panel Analysis. Istanbul Journal of Economics. 2019;69(1):23-41. https://doi.org/10.26650/ISTJECON2019-0016


ABNT

Soybetov, Y. Phillips Curve Estimation During Tranquil and Recessionary Periods: Evidence From Panel Analysis. Istanbul Journal of Economics, [Publisher Location], v. 69, n. 1, p. 23-41, 2019.


Chicago: Author-Date Style

Soybetov, Yhlas,. 2019. “Phillips Curve Estimation During Tranquil and Recessionary Periods: Evidence From Panel Analysis.” Istanbul Journal of Economics 69, no. 1: 23-41. https://doi.org/10.26650/ISTJECON2019-0016


Chicago: Humanities Style

Soybetov, Yhlas,. Phillips Curve Estimation During Tranquil and Recessionary Periods: Evidence From Panel Analysis.” Istanbul Journal of Economics 69, no. 1 (Feb. 2023): 23-41. https://doi.org/10.26650/ISTJECON2019-0016


Harvard: Australian Style

Soybetov, Y 2019, 'Phillips Curve Estimation During Tranquil and Recessionary Periods: Evidence From Panel Analysis', Istanbul Journal of Economics, vol. 69, no. 1, pp. 23-41, viewed 4 Feb. 2023, https://doi.org/10.26650/ISTJECON2019-0016


Harvard: Author-Date Style

Soybetov, Y. (2019) ‘Phillips Curve Estimation During Tranquil and Recessionary Periods: Evidence From Panel Analysis’, Istanbul Journal of Economics, 69(1), pp. 23-41. https://doi.org/10.26650/ISTJECON2019-0016 (4 Feb. 2023).


MLA

Soybetov, Yhlas,. Phillips Curve Estimation During Tranquil and Recessionary Periods: Evidence From Panel Analysis.” Istanbul Journal of Economics, vol. 69, no. 1, 2019, pp. 23-41. [Database Container], https://doi.org/10.26650/ISTJECON2019-0016


Vancouver

Soybetov Y. Phillips Curve Estimation During Tranquil and Recessionary Periods: Evidence From Panel Analysis. Istanbul Journal of Economics [Internet]. 4 Feb. 2023 [cited 4 Feb. 2023];69(1):23-41. Available from: https://doi.org/10.26650/ISTJECON2019-0016 doi: 10.26650/ISTJECON2019-0016


ISNAD

Soybetov, Yhlas. Phillips Curve Estimation During Tranquil and Recessionary Periods: Evidence From Panel Analysis”. Istanbul Journal of Economics 69/1 (Feb. 2023): 23-41. https://doi.org/10.26650/ISTJECON2019-0016



TIMELINE


Submitted31.05.2019
Accepted18.06.2019
Published Online28.06.2019

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