Is the Phillips Curve Stable? A Time-Varying Parameter Approach

Roger K. Conway and Gurmukh S. Gill

No 277925, Staff Reports from United States Department of Agriculture, Economic Research Service

Abstract: We derive two empirical Phillips curve models based on Robert Gordon's reduced form specification of conventional wage and price equations of a more complete structural model of the U.S. economy. One is a stochastic coefficients model and the other is a conventional fixed coefficients model. We used a stochastic coefficients empirical model to investigate the volatility of the Phillips curve relationship hypothesized by many economists during the 1970's. The visual evidence of the time-varying parameter plots suggests there has been variation in the shortrun Phillips curve. Comparative forecasting shows the stochastic coefficients model dominates the fixed coefficients model, further supporting the hypothesis of volatility.

Keywords: Agricultural and Food Policy; Research Methods/Statistical Methods (search for similar items in EconPapers)
Pages: 28
Date: 1987-05
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://ageconsearch.umn.edu/record/277925/files/ers-report-280.pdf (application/pdf)

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:ags:uerssr:277925

DOI: 10.22004/ag.econ.277925

Access Statistics for this paper

More papers in Staff Reports from United States Department of Agriculture, Economic Research Service Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().