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Inflation uncertainty and economic growth: evidence from the LAD ARCH model


Baharumshah, Ahmad Zubaidi and Hamzah, Nor Aishah and Muhammad Sabri, Shamsul Rijal (2011) Inflation uncertainty and economic growth: evidence from the LAD ARCH model. Journal of Applied Statistics, 38 (1). pp. 195-206. ISSN 0266-4763; ESSN: 1360-0532


In this paper, we combined the panel data and least absolute deviation autoregressive conditional heteroscedastic (ARCH) (L 1-ARCH) model to infer on the relationship between inflation uncertainty and economic growth in five emerging market economies. Two interesting findings emerged from the analysis; first, we confirmed that the inflation uncertainty has a significant and negative effect on economic growth. Second, inflation is also an important variable and it is detrimental to economic prospects in the fast-growing Association of Southeast Asian Nations (ASEAN) economies. All in all, the empirical findings suggest that greater stability in the economy may be desirable in order to stimulate economic growth in the region.

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Additional Metadata

Item Type: Article
Divisions: Faculty of Economics and Management
DOI Number: https://doi.org/10.1080/02664760903406397
Publisher: Taylor & Francis
Keywords: Inflation uncertainty; Economic growth; LAD ARCH
Depositing User: Nabilah Mustapa
Date Deposited: 06 Aug 2015 01:21
Last Modified: 26 Aug 2015 08:10
Altmetrics: http://www.altmetric.com/details.php?domain=psasir.upm.edu.my&doi=10.1080/02664760903406397
URI: http://psasir.upm.edu.my/id/eprint/22841
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