 Monetary Pressures and Inflation Dynamics in Turkey: Evidence from P-Star ModelK. Azim Özdemir and
Mesut Saygılı
Emerging Markets Finance and Trade, 2009, vol. 45, issue 6, 69-86 Abstract: This paper uses the P-star model to explain inflation dynamics in Turkey. In P-star models, money determines the price gap, which is postulated to measure the pressure on prices in an economy. This pressure emerges when output is above the potential, the interest rate is lower than the natural rate, or there is pure excess money in the economy. The estimation results with the Turkish data show that the price gap contains considerable information for explaining inflation dynamics. Moreover, the model selection criterion that compares the empirical performance of the P-star model with the new classical Phillips curve relation favors the P-star model over the Phillips curve relationship. We conclude that money is efficacious in predicting risk in price stability in Turkey. Keywords: inflation dynamics; money demand; P-star (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:mes:emfitr:v:45:y:2009:i:6:p:69-86 Ordering information: This journal article can be ordered from Access Statistics for this article More articles in Emerging Markets Finance and Trade from Taylor & Francis Journals |
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