Investigating the Evidence of the Philips Curve in Ghana, Nigeria and the US: Does the empirical evidence support the Philips Curve in Ghana, Nigeria and the US?

Abstract: The main purpose of this study is to quantitatively explore the empirical evidence either in support of or against the existence of the Phillips curve in Ghana using a modified version of the New Keynesian Phillips curve (NKPC) model with Nigeria and US as benchmarks. With time-series data from 1971-2020, the study uses the Ordinary Least Squares (OLS) regression framework to analyse the statistical significance of the parameters of the model. Using different measures of market tightness, informed by Chow’s structural break test, and drawing on variants of the NKPC, the study interestingly  finds that the standard positive association between the output gap and inflation for the US and other advanced economies is not present for Ghana and Nigeria. This new discovery has important relevance for the conduct of economic policy in Ghana, Nigeria and other developing countries and warrants a careful evaluation of the application of the NKPC for developing and emerging economies.

Keywords: Inflation, Money, Monetary Policy, New Keynesian Model, New Keynesian Phillips curve, Phillips curve, Phillips curve evidence,  flattening of the Phillips Curve, Phillips curve evidence in developed and developing countries.

Title: Investigating the Evidence of the Philips Curve in Ghana, Nigeria and the US:  Does the empirical evidence support the Philips Curve in Ghana, Nigeria and the US?

Author: John Adjei

International Journal of Novel Research in Marketing Management and Economics

ISSN 2394-7322

Vol. 10, Issue 1, January 2023 - April 2023

Page No: 1-16

Novelty Journals

Website: www.noveltyjournals.com

Published Date: 03- January- 2023

DOI: https://doi.org/10.5281/zenodo.7501099

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