======Business cycles, expectations and inflation in Brazil: a New-Keynesian Phillips curve analysis======
This study examines Brazilian inflation dynamics using the New-Keynesian Phillips curve, considering different levels of economic foresight.  \\ 
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^  Quick Facts  ^^
|Report location:  |[[https://repositorio.cepal.org/server/api/core/bitstreams/c46afe1b-5c41-4ffa-83d4-fd861c6964b5/content|source]]   |
|Language:  |English  |
|Publisher:  |<WRAP> 
  * [[encyclopedia:economic_commission_for_latin_america|Economic Commission for Latin America]]  
</WRAP>   |
|Authors:  | Ivan Castelar, Elano Ferreira, Elano Ferreira Arruda, Oliveira De Olivindo, Maria Thalita Arruda  |
|Geographic focus:  |Brazil   |
|Page count:  |páginas. 143-15  |

=====Methods=====
The research method involved estimating the New-Keynesian Phillips curve and its hybrid version using the heteroscedasticity-and-autocorrelation-consistent (HAC) estimator of the generalized method of moments (GMM). Monthly data from January 2002 to December 2012 were used, incorporating variables such as the output gap, unemployment gap, firms' real marginal cost, and different measures of inflation expectations.  \\ 
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=====Key Insights=====
The research analyzes Brazil's inflation dynamics within the New-Keynesian Phillips curve framework, focusing on the impact of monetary authority discretion on economic agents' expectations and inflation's response to its inertial component and business-cycle fluctuations. Using the generalized method of moments (GMM), the study finds that lower foresight among economic agents makes inflation more sensitive to business-cycle fluctuations and its inertial component. The results suggest that inflation dynamics in Brazil are influenced by both forward-looking expectations and the inertia of past inflation, with a significant inertial component persisting in the Brazilian economy.  \\ 
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=====Additional Viewpoints=====
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<span #categories_box> Categories:  {{tag>Brazil_geographic_scope}} |  {{tag>English_publication_language}} |  {{tag>business_cycles}} |  {{tag>econometric_models}} |  {{tag>economic_analysis}} |  {{tag>economic_conditions}} |  {{tag>expectations}} |  {{tag>forward-looking_expectations}} |  {{tag>indexation}} |  {{tag>inertial_inflation}} |  {{tag>inflation}} |  {{tag>monetary_policy}}   </span>  


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