Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/154196
Authors: 
López Pérez, Víctor
Year of Publication: 
2015
Series/Report no.: 
ECB Working Paper 1763
Abstract: 
This paper finds that participants in the European Central Bank’s Survey of Professional Forecasters have submitted forecasts that are consistent with a (mostly forward-looking) New Keynesian Phillips Curve for the euro area. The estimation results suggest that euro-area inflation forecasts have reacted less to unemployment forecasts after the start of the financial crisis but another cost measure (energy inflation) remains significant. This finding is consistent with a flatter Phillips Curve in the euro area. However, the reasons suggested by the International Monetary Fund for this finding, namely a better anchoring of inflation expectations and increases in structural unemployment do not seem to find support in the survey data. Instead, downward wage rigidities may be playing a prominent role.
Subjects: 
downward wage rigidities
inflation
new Keynesian Phillips curve
panel data
Survey of Professional Forecasters
Unemployment
JEL: 
E31
J30
ISBN: 
978-92-899-1576-2
Document Type: 
Working Paper

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