Backward bending structure of Phillips Curve in Japan, France, Turkey and the U.S.A.

Bildirici, Melike; Sonüstün, Fulya Özaksoy

doi:10.1080/1331677x.2018.1441046

Cited by 12 publications

(6 citation statements)

References 36 publications

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“…N’Guessan (2018) explored the asymmetric Phillip curve in Cote d'Ivoire using threshold cointegration methods and found that positive shocks to unemployment respond more rapidly than negative shocks and suggested the need for a particular threshold to be reached before unemployment declines rapidly. Similarly, Bildirici and Ozaksoy (2018) analyzed the same investigation in the cases of Turkey, the USA, France and Japan. The authors uncovered a weak trade-off between the variables during increasing unemployment, but it becomes stronger when the labour market is tightened.…”

Section: Literature Reviewmentioning

confidence: 99%

Non-linearity in the Phillips curve: evidence from Nigeria

Onatunji,

Adeleke,

Adejumo

2023

AJEMS

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PurposeThis study reinvestigates the validity of the Phillips curve in Nigeria for the period 1980–2020 by considering the asymmetric nexus between unemployment and inflation.Design/methodology/approachThe nonlinear autoregressive distributed lag (NARDL) technique was used to decompose the unemployment variable into two components: tight and loosened labour markets.FindingsThe empirical outcome shows that unemployment has a significant negative effect on inflation when the labour market is tight and a weakly negative and significant effect on inflation when the labour market is loose. The study confirms an asymmetric Phillips curve in Nigeria since the positive (tight) unemployment rate exerts a greater effect on inflation than the negative (loosened) unemployment rate.Practical implicationsThe findings of this study have important implications for implementing monetary policy in Nigeria.Originality/valueTo the best of the authors’ knowledge, this is the first study to investigate the existence of a nonlinear Phillip curve in Nigeria.

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Section: Literature Reviewmentioning

confidence: 99%

Non-linearity in the Phillips curve: evidence from Nigeria

Onatunji,

Adeleke,

Adejumo

2023

AJEMS

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“…Furthermore, N'Guessan (2018) explored the non-linear Phillips curve in Cote d'Ivoire by employing threshold cointegration methods and found that positive shocks to unemployment respond more rapidly than negative shocks. Bildirici and Ozaksoy (2018) revisited the same inquiry in the cases of Turkey, the USA, France, and Japan, and the authors discovered a weak trade-off between the variables during increasing unemployment, but it became stronger when the labour market was tightened. Conversely, Bryne and Zekaite (2019) discovered that wage inflation is unresponsive to unemployment when the labour market is tight in Euro-area economies.…”

Section: Brief Literature Reviewmentioning

confidence: 99%

A new perspective on the asymmetric Phillips curve: Fresh evidence from ECOWAS member countries

Onatunji,

Adejumo,

Olabode

2024

Zagreb International Review of Economics and Business

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A growing body of scholarly research has explored the non-linearity of the Phillips curve, but empirical evidence from an African perspective, particularly within the ECOWAS sub-regional context, remains underexplored. This study aims to address this gap by offering a fresh perspective on the asymmetric Phillips curve for West African countries through a comparative country-specific analysis and a panel framework utilizing the nonlinear autoregressive distributed lag (NARDL) model for the period 1986–2020. The empirical outcomes demonstrate that the asymmetric response of inflation to both positive and negative unemployment differs across the countries of Benin, Burkina Faso, Ghana, Guinea, Cote d’Ivoire, Liberia, Mali, Niger, Nigeria, Senegal, Sierra Leone, and Togo. Specifically, the study finds that inflation declines when unemployment rises and surges when unemployment declines in both short- and long-term dynamics. These findings highlight that low unemployment during economic expansion leads to wage-price spirals, while high unemployment results in low inflationary pressure during economic downturns in the analyzed countries. The empirical outcomes are robust and consistent for both country-specific and panel analyses, but the extent of the inflation response to unemployment is more pronounced in the WAMZ subregion. This study provides valuable insights for policymakers regarding the formulation of sound regional monetary policy.

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“…They also reported an asymmetric causality between diff erent signs of the shocks, based on the Hatemi-J (2012) asymmetric causality test. Diff erently, Bildirici and Ozaksoy (2016), and Bildirici and Ozaksoy Sonustun (2018) focused on the other demand indicators in their analyses. While the former reported an asymmetry for Canada, the latter revealed an asymmetry for Japan, France, Turkey, and the USA.…”

Section: Literature Reviewmentioning

confidence: 99%

Symmetric and Asymmetric Dynamics of Output Gap and Inflation Relation for Turkish Economy

Biçer,

Burgac Cil

2023

Prague Economic Papers

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This paper uses symmetric and asymmetric testing procedures to examine the issue of the relationship between the output gap and infl ation for the Turkish economy using data from 2002:01 to 2021:09. First, it analyses the cointegration by applying diff erent cointegration tests taking into account structural breaks and asymmetric behaviour to reveal whether the relation varies between sub-periods. Afterwards, it examines the asymmetric causality between diff erent shocks. Our empirical results indicate that there is a long-run relationship between series in the existence of two structural breaks and asymmetry. The results also show asymmetric causality running from positive (negative) output gap to positive (negative) infl ation shock, and running from negative infl ation shock to negative output gap shock. The overall fi ndings indicate the importance of having in mind the structural breaks and asymmetric behaviour of macroeconomic variables in policy-making processes, such as in Turkey during high and volatile infl ation.

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Backward bending structure of Phillips Curve in Japan, France, Turkey and the U.S.A.

Abstract: This work aims to analyse the cointegration and the causality relationship between inflation and unemployment by using nonlinear

Cited by 12 publications

References 36 publications

Non-linearity in the Phillips curve: evidence from Nigeria

Non-linearity in the Phillips curve: evidence from Nigeria

A new perspective on the asymmetric Phillips curve: Fresh evidence from ECOWAS member countries

Symmetric and Asymmetric Dynamics of Output Gap and Inflation Relation for Turkish Economy

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