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Inflación Subyacente en la República Dominicana: Medición y Evaluación
[Core Inflation in the Dominican Republic: Measurement and Evaluation]

Author

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  • Jiménez Polanco, Miguel Alejandro
  • Ramírez de Leon, Francisco Alberto

Abstract

In this paper we compare the official core inflation measure, which is based on the ad hoc exclusion of specific items from the total CPI, against alternatives available in the literature on measurement of trend inflation. The evaluation is done through different criteria that adequate core inflation must display; i.e.: (1) less volatility relative to total inflation, (2) absence of bias related to total inflation and (3) predictive power on medium run inflation. Our results suggest that the official indicator delivers the desired properties. Moreover, it overcomes most of the alternative measures available in the literature.

Suggested Citation

  • Jiménez Polanco, Miguel Alejandro & Ramírez de Leon, Francisco Alberto, 2017. "Inflación Subyacente en la República Dominicana: Medición y Evaluación [Core Inflation in the Dominican Republic: Measurement and Evaluation]," MPRA Paper 84596, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:84596
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    References listed on IDEAS

    as
    1. Michael F. Bryan & Stephen G. Cecchetti, 1994. "Measuring Core Inflation," NBER Chapters, in: Monetary Policy, pages 195-219, National Bureau of Economic Research, Inc.
    2. Mikael Khan & Louis Morel & Patrick Sabourin, 2013. "The Common Component of CPI: An Alternative Measure of Underlying Inflation for Canada," Staff Working Papers 13-35, Bank of Canada.
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    More about this item

    Keywords

    Inflation; CPI; Core inflation;
    All these keywords.

    JEL classification:

    • C10 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - General
    • C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation

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