TITLE

Inflation Dynamics in Romania - a New Keynesian Perspective

AUTHOR(S)
Ciurilă, Nicoleta; Muraraşu, Bogdan
PUB. DATE
November 2008
SOURCE
European Research Studies;2008, Vol. 11 Issue 4, p31
SOURCE TYPE
Academic Journal
DOC. TYPE
Article
ABSTRACT
The objective of this paper is to identify the main factors which drive inflation in Romania: inflation persistence, inflation expectations and real economy variables. We estimate a reduced form hybrid New Keynesian Phillips Curve in order to determine the degree of inertia and the impact of forward looking expectations. As a proxy for real economic activity, we alternatively use the output gap, the unemployment gap, the unit labour cost, the capacity utilization rate and the economic sentiment indicator. We focus on the role of the monetary policy in controlling the various sources of inflation.
ACCESSION #
36400752

 

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