The Distribution of The Inflation in Turkey
Nazif Catik () and
A. Özlem Önder
Ege Academic Review, 2010, vol. 10, issue 2, 613-625
This paper investigates distribution of inflation items using various measures of skewness and kurtosis for Turkey covering the period 1996-2007. Considering sensitivity of traditional distribution measures to outlying observations robust skewness and kurtosis are also computed as a novelty. Analysis results mainly reveal that inflation components are right skewed and fat tailed as documented by the previous studies. However due to possible effects of the outliers traditional measures, in particular skewness, are lagging behind the robust measures in identifying underlying dispersion. Therefore one can say that weighted mean inflation used to measure general price changes is not trustworthy and a biased estimator of central location. Our results further suggest that core measures based on constant and symmetric trimming applied by the previous studies for Turkey is somewhat deficient since skewness of the data is ignored in the estimation process. Therefore, to obtain more reliable information in monitoring general price movements we suggest use of asymmetric trimmed means estimators which allows trimming different percentages from each tail of the distribution.
Keywords: Inflation; Robust Skewness and Kurtosis (search for similar items in EconPapers)
JEL-codes: E31 (search for similar items in EconPapers)
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