EconPapers    
Economics at your fingertips  
 

Estimates of the Sticky-Information Phillips Curve for the United States, Canada, and the United Kingdom

Hashmat Khan () and Zhenhua Zhu

Staff Working Papers from Bank of Canada

Keywords: Economic models; Inflation and prices (search for similar items in EconPapers)
JEL-codes: E31 (search for similar items in EconPapers)
Pages: 40 pages Abstract: Mankiw and Reis (2001a) have proposed a “sticky-information”-based Phillips curve (SIPC) to address some of the concerns with the “sticky-price”-based new Keynesian Phillips curve. In this paper, we present a methodology for the empirical implementation of the SIPC for closed and open economies. We estimate its key structural parameter—the average duration of information stickiness—for the United States, Canada, and the United Kingdom. The benchmark results (with forecasting horizons of firms of seven to eight quarters) indicate that: (i) the average frequency of information updates is four quarters in the United States, between four and five quarters in Canada, and over seven quarters in the United Kingdom, and (ii) the open-economy estimates for Canada and the United Kingdom are similar to the closed-economy ones. Mankiw and Reis (2001a) assume information stickiness of four quarters to generate inflation dynamics similar to that observed in the U.S. data. We interpret our estimates in terms of the slope of the Phillips curve. Our structural estimates can be used to calibrate dynamic general-equilibrium models for monetary policy analysis that use informational inertia to match the stylized facts on inflation dynamics.
Date: 2002
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (39)

Downloads: (external link)
https://www.bankofcanada.ca/wp-content/uploads/2010/02/wp02-19.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:bca:bocawp:02-19

Access Statistics for this paper

More papers in Staff Working Papers from Bank of Canada 234 Wellington Street, Ottawa, Ontario, K1A 0G9, Canada. Contact information at EDIRC.
Bibliographic data for series maintained by ().

 
Page updated 2025-03-22
Handle: RePEc:bca:bocawp:02-19