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dc.contributor.authorPaloviita, Marittaen_US
dc.contributor.authorMayes, Daviden_US
dc.description.abstractThe dynamics of the Phillips Curve in New Keynesian, Expectations Augmented andHybrid forms are extremely sensitive to the choice, timing and restrictions on variables.An important element of the debate revolves round what information decision-makerstook into account at the time and round what they thought was going to happen in thefuture. The original debate was conducted using up to date, revised estimates of the dataas in the most recent official publications. In this paper, however, we explore how muchthree aspects of the specification of the information available at the time affect theperformance of the various Phillips curves and the choice of the most appropriatedynamic structures. First we consider the performance of forecasts, published at thetime, as representations of expectations. Second, we explore the impact of using 'realtime data' in the sense of what were the most recently available estimates of the thenpresent and past. Finally we review whether it helps to use the information that wasavailable at the time in the choice of instruments in the estimation of the relationshipsrather than the most up to date estimate of the data series that has been published. Thusdifferent datasets are required in the instrument set for every time period. We use asingle consistent source for 'real-time' data on the past, estimates of the present andforecasts, from OECD Economic Outlook and National Accounts. We set this up as apanel for the euro area countries covering the period since 1977. The OECD publishesforecasts twice a year, which permits a more detailed exploration of the importance ofthe timing of information. Our principal conclusions are (1) that the most important useof real time information in the estimation of the Phillips curve is in using forecasts madeat the time to represent expectations; (2) real time data indicate that the balance ofexpectations formation was more forward than backward-looking; (3) by contrast usingthe most recent, revised, data suggests more backward-looking and less well-determinedbehaviour.en_US
dc.publisher|aDeutsche Bundesbank |cFrankfurt a. M.-
dc.relation.ispartofseries|aDiscussion paper Series 1 / Volkswirtschaftliches Forschungszentrum der Deutschen Bundesbank |x2004,28en_US
dc.subject.keywordreal-time dataen_US
dc.subject.keywordPhillips curveen_US
dc.subject.keywordeuro areaen_US
dc.subject.stwEuropäische Wirtschafts- und Währungsunionen_US
dc.titleThe use of real-time information in Phillips curve relationships for the euro areaen_US
dc.typeWorking Paperen_US

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