The aim of this study is to investigate both the short-run and long-run relationship between inflation and unemployment characterizing the US economy in the last 30 years. To this end a cointegrated structural VAR vs built. Since unemployment does not cause inflation at frequency zero a recursive structure, with inflation ordered first, allows the identification of a permanent and a transitory shock (cf. Ribba, Economics Letters 56, pp. 253-6, 1997). The main conclusions of the investigation are that: (i) in the short run, the existence of a tradeoff induced by the transitory shock is confirmed; (ii) in the long run, the two variables move one-for-one in the same direction driven by a permanent supply shock.

Short-run and long-run interaction between inflation and unemployment in the USA / Ribba, Antonio. - In: APPLIED ECONOMICS LETTERS. - ISSN 1350-4851. - STAMPA. - 10:6(2003), pp. 373-376. [10.1080/1350485032000081983]

Short-run and long-run interaction between inflation and unemployment in the USA

RIBBA, Antonio
2003

Abstract

The aim of this study is to investigate both the short-run and long-run relationship between inflation and unemployment characterizing the US economy in the last 30 years. To this end a cointegrated structural VAR vs built. Since unemployment does not cause inflation at frequency zero a recursive structure, with inflation ordered first, allows the identification of a permanent and a transitory shock (cf. Ribba, Economics Letters 56, pp. 253-6, 1997). The main conclusions of the investigation are that: (i) in the short run, the existence of a tradeoff induced by the transitory shock is confirmed; (ii) in the long run, the two variables move one-for-one in the same direction driven by a permanent supply shock.
2003
10
6
373
376
Short-run and long-run interaction between inflation and unemployment in the USA / Ribba, Antonio. - In: APPLIED ECONOMICS LETTERS. - ISSN 1350-4851. - STAMPA. - 10:6(2003), pp. 373-376. [10.1080/1350485032000081983]
Ribba, Antonio
File in questo prodotto:
Non ci sono file associati a questo prodotto.
Pubblicazioni consigliate

Licenza Creative Commons
I metadati presenti in IRIS UNIMORE sono rilasciati con licenza Creative Commons CC0 1.0 Universal, mentre i file delle pubblicazioni sono rilasciati con licenza Attribuzione 4.0 Internazionale (CC BY 4.0), salvo diversa indicazione.
In caso di violazione di copyright, contattare Supporto Iris

Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/11380/5226
Citazioni
  • ???jsp.display-item.citation.pmc??? ND
  • Scopus 8
  • ???jsp.display-item.citation.isi??? 8
social impact