The relation between the producer and consumer price indices: a two-country study

Topuz, Yusuf Volkan; Yazdifar, Hassan; Sahadev, Sunil

doi:10.1057/s41272-017-0125-x

Cited by 11 publications

(5 citation statements)

References 16 publications

(16 reference statements)

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“…For South Africa, it can be said that while consumers determine their spending trends, they are more sensitive to producer price increases and adjust their consumption behavior accordingly. Among the studies conducted for Turkey, it supports the studies (Abdioğlu & Korkmaz, 2012;Koçak, 2021;Topuz et al, 2018) claiming that there is a bidirectional relationship between consumer prices and producer prices. It has been observed that negative deviations in producer prices in Turkey bring consumer prices to equilibrium faster.…”

Section: Discussionsupporting

confidence: 63%

“…The analyses showed that there is a bidirectional causality relationship, supporting the neoclassical profit maximising model. Examining the relationship in terms of determining the dominant pricing approach in an economy, Topuz et al (2018) found a bidirectional causality relationship between the two variables for both Turkey and England. Producer prices are comparatively more essential on the consumer prices in both countries.…”

Section: Review Of the Theoretical Framework And Literaturementioning

confidence: 99%

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Kırılgan Beşli Ülkelerde Tüketici ve Üretici Fiyatları Arasındaki Aktarım Mekanizması: Eşik Eşbütünleşme ve Hata Düzeltme

MERT

2023

Hacettepe Üniversitesi İktisadi Ve İdari Bilimler Fakültesi Dergisi

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This study focuses on examining the interrelationship between consumer and producer prices within the framework of the fragile five within the scope of asymmetric models. Considering the 2010:M1-2021:M8 period, TAR and M-TAR cointegration and error correction models were used in the study. The results of the analysis indicated that there was no asymmetrical relationship between CPI and PPI for Brazil and India, while it pointed to an asymmetric long-term relationship for South Africa, Indonesia, and Turkey. According to the asymmetric error correction estimation results, while no long-term asymmetric causality relationship could be found for Indonesia, South Africa and Turkey, it was determined for the short-term. According to this, there is a causal relationship from PPI to CPI for Indonesia, from CPI to PPI for South Africa, and bidirectional causality for Turkey. The differences in the transmission mechanism between the price indices of the fragile five countries reveal the differences in the internal dynamics of the countries.

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Section: Discussionsupporting

confidence: 63%

Section: Review Of the Theoretical Framework And Literaturementioning

confidence: 99%

Kırılgan Beşli Ülkelerde Tüketici ve Üretici Fiyatları Arasındaki Aktarım Mekanizması: Eşik Eşbütünleşme ve Hata Düzeltme

MERT

2023

Hacettepe Üniversitesi İktisadi Ve İdari Bilimler Fakültesi Dergisi

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“…Furthermore, it is possible to identify a bidirectional transmission mechanism, but stronger in one direction (Shahbaz et al ,2009). This third approach is validated by Nilcan (2023) for Turkey, Topuz et al (2018) for Turkey and England, Su and al. (2016) for Slovakia, Tiwari and Shahbaz (2013) for India, Cerquera-Losada et al (2018) for Peru, Akcay (2011) for Germany and Sun et al (2023) for China.…”

Section: Bilateral Relation: Feedback Linkagesmentioning

confidence: 84%

CPI and PPI: Who drives who in the time-frequency space?

Bidan,

MESTRE

2024

Preprint

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The purpose of this study is to examine the relationship between Consumer Price Index and Producer Price Index across various business cycles in France. Concerning methodological aspects of this paper, we apply partial continuous wavelets transforms to perform time-frequencies analysis to remove the effect of the monetary trend on this relationship. The results indicate a positive relationship between CPI and PPI, during economic crisis, particularly at the mid-term. With partial wavelet coherence to consider the monetary mass, we analyze the long-term relationship between the two indexes. The phase-difference interpretation exhibits a lead of PPI over CPI. JEL codes : C54; E31; E32; E02 ; E50

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“…It has also been found that consumer and producer prices are in motion together. Some of the studies that reached these findings; Abdioğlu and Korkmaz (2012), Tailor and Tütüncü (2017), Topuz, Yazdifar and Sahadev (2018) and Koçak (2021).…”

Section: Literaturementioning

confidence: 92%

Investigation of Asymmetric Relationship Between Consumer and Producer Prices in Turkey: Evidence from Hidden Cointegration and Asymmetric Causality Analyses

Demir

2022

Alanya Akademik Bakış

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The continuity of price stability is a necessity for the successful management of economic policy, especially monetary policy. Considering that price instability will lead to policy failure, it is extremely important that the general level of prices be accurate and predictable. When the interaction of prices within its own internal mechanism is considered within the scope of the production chain, an evaluation can be made with the distinction of producer and consumer prices. In this regard, the literature has two different views as supply-side and demand-side price transmission. In this study, it is aimed to determine which view is dominant between producer and consumer prices in Turkey. In addition, asymmetric techniques were used while investigating long and short-term relationships based on the idea that there may be an asymmetric structure in price transmission. In the analysis process, the interaction of domestic, agricultural and service producer prices with consumer prices was investigated. According to the results, although supplyside price transmission is valid in the long run, it is seen that the demand-side effect is more significant. In the short run, it can be stated that there is a supply-side price transmission. It is thought that the obtained findings will make significant contributions to the authorities and researchers in the formation of policies based on the inflation targeting regime in terms of the variables used and the analysis technique. ÖZETPara politikası başta olmak üzere ekonomi politikasının başarılı yönetilmesi için fiyat istikrarının devamlılığı bir gerekliliktir. Fiyat istikrarsızlığı politika başarısızlığına yol açacağı düşünüldüğünde, fiyatlar genel seviyesinin doğru ve önceden belirlenebilir olması son derece önemlidir. Fiyatların kendi iç

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The relation between the producer and consumer price indices: a two-country study

Cited by 11 publications

References 16 publications

Kırılgan Beşli Ülkelerde Tüketici ve Üretici Fiyatları Arasındaki Aktarım Mekanizması: Eşik Eşbütünleşme ve Hata Düzeltme

Kırılgan Beşli Ülkelerde Tüketici ve Üretici Fiyatları Arasındaki Aktarım Mekanizması: Eşik Eşbütünleşme ve Hata Düzeltme

CPI and PPI: Who drives who in the time-frequency space?

Investigation of Asymmetric Relationship Between Consumer and Producer Prices in Turkey: Evidence from Hidden Cointegration and Asymmetric Causality Analyses

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