Malikane, Christopher; Mokoka, Tshepo - In: Applied Economics 46 (2014) 25, pp. 3082-3089
The wrong or insignificant sign of the forcing variable in the new Keynesian Phillips curve estimations may be a result of the endogeneity of the labour share and misspecification of real marginal cost in the baseline model. We address the misspecification of real marginal cost by formulating a...