Book contents
- Frontmatter
- Contents
- Foreword by Robert M. Solow
- Preface
- Introduction
- PART ONE THE HISTORY, THEORY, AND MEASUREMENT OF PRODUCTIVITY GROWTH
- PART TWO INTERPRETING PRODUCTIVITY FLUCTUATIONS OVER THE BUSINESS CYCLE
- PART THREE THE THEORY OF THE INFLATION-UNEMPLOYMENT TRADEOFF
- PART FOUR EMPIRICAL STUDIES OF INFLATION DYNAMICS IN THE UNITED STATES
- Part Four Introduction
- 14 Can the Inflation of the 1970s be Explained?
- 15 The Output Cost of Disinflation in Traditional and Vector Autoregressive Models
- 16 German and American Wage and Price Dynamics: Differences and Common Themes
- 17 Foundations of the Goldilocks Economy: Supply Shocks and the Time-Varying NAIRU
- Subject Index
- Author Index
- References
Part Four - Introduction
Published online by Cambridge University Press: 10 December 2009
- Frontmatter
- Contents
- Foreword by Robert M. Solow
- Preface
- Introduction
- PART ONE THE HISTORY, THEORY, AND MEASUREMENT OF PRODUCTIVITY GROWTH
- PART TWO INTERPRETING PRODUCTIVITY FLUCTUATIONS OVER THE BUSINESS CYCLE
- PART THREE THE THEORY OF THE INFLATION-UNEMPLOYMENT TRADEOFF
- PART FOUR EMPIRICAL STUDIES OF INFLATION DYNAMICS IN THE UNITED STATES
- Part Four Introduction
- 14 Can the Inflation of the 1970s be Explained?
- 15 The Output Cost of Disinflation in Traditional and Vector Autoregressive Models
- 16 German and American Wage and Price Dynamics: Differences and Common Themes
- 17 Foundations of the Goldilocks Economy: Supply Shocks and the Time-Varying NAIRU
- Subject Index
- Author Index
- References
Summary
EMPIRICAL IMPLEMENTATION OF THE TRIANGLE MODEL
Time-series econometrics lives a life of its own. When I started running Phillips curve regressions, the sample period was 1954–69, a mere 64 quarters of data, and many fewer degrees of freedom once current and lagged explanatory variables are included. My latest work, still in progress, covers the sample period 1954–2002, fully three times as many quarters of data. Why should any empirical paper be included in this volume other than the latest, since the latest overlaps the time coverage of the earliest and provides far more scope to explore stability and changes in parameters?
Part Four includes as Chapter Seventeen the latest (1998) published empirical paper on the dynamics of inflation behavior. However, more is involved in understanding empirical work than archiving the old framework in order to pursue the new framework. The first two papers included in Part Four (Chapter Fourteen, published in early 1977, and Chapter Fifteen, published in 1982) taken together helped to reorient the econometrics of the Phillips curve toward the specification and format that has become standard since the early 1980s. This specification has been fruitfully used to study the sources of low inflation in the 1990s not just by myself, but also by Douglas Staiger, James Stock, Mark Watson (1997, 2001), and others.
The framework introduced in Chapters Fifteen and Sixteen contrasts sharply with the standard approach of inflation studies dating back to the earliest econometric models of the late 1950s and early 1960s.
- Type
- Chapter
- Information
- Productivity Growth, Inflation, and UnemploymentThe Collected Essays of Robert J. Gordon, pp. 359 - 366Publisher: Cambridge University PressPrint publication year: 2003