Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/174102
Authors: 
Easaw, Joshy
Heravi, Saeed
Dixon, Huw David
Year of Publication: 
2015
Series/Report no.: 
Cardiff Economics Working Papers E2015/13
Abstract: 
The purpose of the present paper is to investigate perceived inflation gap persistence using actual data of professional forecasts. We derive the unobserved perceived inflation gap persistence and using a state dependent model we estimate the non-linear persistence coefficient of inflation gap. Our main result is that for GDP deflator inflation, the estimates of persistence largely confirm the results obtained indirectly using a linear model. However, when we look at CPI inflation, we find that there is strong evidence for state-dependence and time variation.
Subjects: 
Perceived Inflation Gaps
Professional´s Survey-based Forecasts
State-Dependent Models
JEL: 
E31
E52
E58
Document Type: 
Working Paper

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