The hybrid Phillips curve and inflation in post-Soviet Central Asia and the South Caucasus

Ihlas Sovbetov

Post-Communist Economies, 2025, vol. 37, issue 8, 1149-1171

Abstract: Using the hybrid New Keynesian Phillips Curve, this paper provides the first multi-country estimation for Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan using quarterly data from 1996 to 2023, and continuously-updating GMM. We estimate closed- and open-economy specifications with perfect and imperfect pass-through. Inflation combines substantial backward-looking inertia with a meaningful forward-looking component: persistence is strongest in Tajikistan and Turkmenistan, while Georgia and Armenia are the most forward-oriented, and Kazakhstan is balanced. In panel estimates the backward- and forward-looking weights are about 0.55 and 0.45. Cost slopes indicate that domestic real marginal costs dominate, but imported pressures are material, accounting for about 46% of cost slopes under perfect pass-through and 41% under imperfect pass-through, with external channels especially salient in Kyrgyzstan and Tajikistan. Structural parameters imply price resets roughly every two to two and a half quarters and a high yet incomplete exchange-rate pass-through near 0.87.

Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1080/14631377.2025.2576203 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:pocoec:v:37:y:2025:i:8:p:1149-1171

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/CPCE20

DOI: 10.1080/14631377.2025.2576203

Access Statistics for this article

Post-Communist Economies is currently edited by Roger Clarke

More articles in Post-Communist Economies from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().