Quality Growth versus Inflation in Turkey

Quality Growth versus Inflation in Turkey

Title : Quality Growth versus Inflation in Turkey
Number : 11/21
Author(s) : Yavuz Arslan, Evren Ceritoğlu
Language : English
Date : October 2011
Abstract : We estimate average quality growth and upward inflation bias for a set of 51 goods in Turkey by using 7 waves of Household Budget Survey from 2003 to 2009 and TURKSTAT prices. We employ instrumental variables approach introduced by Bils and Klenow (2001). We find that average quality growth in Turkey is 3.93 percent. Of this 3.93 percent, 2.28 percent is not netted out by TURKSTAT. Consequently, for the set of goods that we study, the estimated inflation bias is 2.28 percentage points.
Keywords : Quality bias, Inflation rates
JEL Codes : D12; E31

Quality Growth versus Inflation in Turkey
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