 CPI and inflation in Kenya. Structural breaks, non-linearities and dependenceLuis Gil-Alana and Robert Mudida International Economics, 2017, vol. 150, issue C, 72-79 Abstract: This paper deals with the analysis of inflation in Kenya. We use data from the Consumer Price Index and inflation to examine, among other issues, features such as the presence of structural breaks, non-linearities and time dependence or persistence in the data. The results indicate the presence of a structural break in the inflation rate taking place in 1994, observing a level shift and a reduction in the degree of integration of the series. However, the results change depending on the assumptions made on the error term. Thus, under no autocorrelation the unit root hypothesis cannot be rejected in any of the two subsamples; however, under the more realistic assumption of autocorrelation, mean reversion takes places in the two subsample, with a slightly reduction after the break. These results are explained in terms of the policy reform and intervention during the last two decades, and some policy recommendations are also presented in the paper. Keywords: Prices; Inflation; Non-linearities; Long memory; Structural breaks; Kenya (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:inteco:v:150:y:2017:i:c:p:72-79 DOI: 10.1016/j.inteco.2016.12.003 Access Statistics for this article International Economics is currently edited by Valerie Mignon and Marcelo Olarreaga More articles in International Economics from Elsevier |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
School of Business at Örebro University.