Multivariate model-based gap measures and a new Phillips curve for China

Chengsi Zhang and Yasutomo Murasawa

China Economic Review, 2012, vol. 23, issue 1, 60-70

Abstract: This paper examines empirically the Phillips curve relationship for the Chinese economy. We use quarterly data that go back to 1978 and employ a multivariate rather than univariate method in the construction of gap measures for inflation, money and output jointly with reliable error bands. Our empirical results show that the inflation gap and the output gap fit a New Phillips curve very well. We also find some structural change in the inflation–output trade-off.

Keywords: Phillips curve; Bayesian estimator; Output gap; Structural change (search for similar items in EconPapers)
JEL-codes: C11 C22 E31 E32 E58 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:chieco:v:23:y:2012:i:1:p:60-70

DOI: 10.1016/j.chieco.2011.07.014

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