THE PHILLIPS CURVE ESTIMATION FOR THE RUSSIAN ECONOMY
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Author(s): | Sinelnikova-Muryleva E. V., Vatulich M. A., |
| Number of journal: | 3(72) | Date: | September 2025 |
| Annotation: | The Phillips curve is an important component of many general equilibrium macroeconomic models analyzing central bank policy. It also serves as a constraint in the opti- mization problem of the central bank adhering to the inflation targeting regime. Periods of macroeconomic instability and structural shifts that have occurred in the Russian economy over the past 10-15 years indicate the need for up-to-date estimates of the relationship between inflation and economic activity. This paper is devoted to estimating the Phillips curve for the Rus- sian economy using data for 2010-2024. The generalized meth- od of moments was used. The following indicators were used as inflation metrics: consumer price index (CPI), base consumer price index (BCPI), GDP deflator, producer price index (PPI), and producer price index in the manufacturing industry. The out- put gap, unemployment gap, and unemployment rate according to the International Labor Organization methodology were used as indicators of the real economy. Two types of inflation expecta- tions were tested: adaptive and hybrid. The conducted estimates showed that the Phillips curve is consistent with the data on the Russian economy. The equations explaining the relationships between the pairs of indicators (CPI – output gap, BICP – output gap, CPI – unemployment gap) have the best set of statistical characteristics. It was shown that the real effective exchange rate is a significant exogenous factor of inflation. According to the estimation results, inflation expectations of economic agents in Russia are adaptive and do not have a “long memory” effect. In other words, the inflation levels in the last two quarters are most important for the population in predicting inflation. | ||
| Keywords: | Phillips curve, unemployment, unemployment gap, output, potential output, output gap, inflation, consu mer price index, Hodrick-Prescott filter, Kalman filter, inflation expectations |
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| For citation: | Sinelnikova-Muryleva E. V., Vatulich M. A. The Phillips curve estimation for the Russian economy. Biznes. Obrazovanie. Pravo = Business. Education. Law. 2025;3(72):154—159. DOI: 10.25683/VOLBI.2025.72.1384. |
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