INVESTIGATING THE STABILITY OF PHILLIPS CURVE: PANEL DATA EVIDENCE FROM DEVELOPING WORLD
INVESTIGATING THE STABILITY OF PHILLIPS CURVE: PANEL DATA EVIDENCE FROM DEVELOPING WORLD

Author(s): Muhammad Azam, Saleem Khan, Laura Ștefănescu
Subject(s): Economy, Business Economy / Management, Accounting - Business Administration
Published by: ASERS Publishing
Keywords: unemployment; inflation; Phillips Curve; panel data
Summary/Abstract: In this chapter, we investigate the stability of Phillips Curve for 14 developing countries, using annual panel data from 1991 to 2012. After checking the data for stationarity purpose, we used various panel unit root tests and found the data were almost stationary at level. Our sample of 14 countries grouped into two groups-Asian and non-Asian developing countries. The empirical results reveals that in the group of Non-Asians countries regardless of the model effects, the effects of unemployment on inflation is not considerable and the estimated coefficients of unemployment is not only of small value but insignificant all around in the case study Mostly, results of the present study with robust estimates confirm, that there is no significant relationship between inflation and unemployment in selected group of countries and suggest that the Philips Curve is unstable.

• Details
• Contents