PL EN


2016 | 2(16) | 3 | 121-137
Article title

Simple four-step procedure of parabolic B curve determination for OECD countries in 1990Q1 – 2015Q4

Content
Title variants
Languages of publication
EN
Abstracts
EN
In theory the short-term relationship between inflation and GDP rate is known as the positive slope straight line SAS. In practice it is reflected by a concave non-monotonic function. The results of estimation depend on unusual observations. We propose a simple four-step procedure: first, basic estimation based on all observations; then estimation having ignored outliers; next, estimation on the average GDP rates for given inflation rates for the same observations; lastly, estimation skipping outlying averages. Empirical analysis for 26 OECD countries on quarterly data brought satisfactory results. They justified the determination of optimal GDP rate and corresponding inflation for every country. Finally, recommendations for policymakers have been formulated.
EN
In theory the short-term relationship between inflation and GDP rate is known as the positive slope straight line SAS. In practice it is reflected by a concave non-monotonic function. The results of estimation depend on unusual observations. We propose a simple four-step procedure: first, basic estimation based on all observations; then estimation having ignored outliers; next, estimation on the average GDP rates for given inflation rates for the same observations; lastly, estimation skipping outlying averages. Empirical analysis for 26 OECD countries on quarterly data brought satisfactory results. They justified the determination of optimal GDP rate and corresponding inflation for every country. Finally, recommendations for policymakers have been formulated.
Year
Volume
Issue
3
Pages
121-137
Physical description
Dates
published
2016-09-30
Contributors
  • Vistula University, Faculty of Business and International Relations, ul. Stokłosy 3, 02-787 Warsaw; Poland, d.blaszczuk@vistula.edu.pl
References
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Document Type
Publication order reference
Identifiers
YADDA identifier
bwmeta1.element.desklight-b3799179-4fe4-4a4d-a09d-5d3f79686c30
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