Expectations-augmented Phillips curve: further evidence from state economies
This paper tests the expectations-augmented Phillips-curve hypothesis for the 50 states in the US. Unlike previous work both adaptive and rational expectations are incorporated in the modeling of the Phillips-curve relationship. Second, the role of relative regional wages are taken into account. Third, the wage-price controls of 1971-72 and 1972-73 are included in the modeling efforts. The empirical results suggest that the expectations-augmented Phillips-curve model based on adaptive expectations provides better results across the 50 states than the Phillips-curve model based on rational expectations.
Year of publication: |
1995
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Authors: | Payne, James |
Published in: |
Applied Economics Letters. - Taylor & Francis Journals, ISSN 1350-4851. - Vol. 2.1995, 8, p. 248-254
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Publisher: |
Taylor & Francis Journals |
Saved in:
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