Huang Zhengxin and Huang Yu
Abstract: This paper creates a New Keynesian Hybrid Phillips Curve containing four factors of China by introducing the real property price as supply shocks. The research shows that in the NKPC model, there is a mutual influence among inflation expectation, inflation inertia, supply shocks, GDP gap and inflation. The influence of inflation expectation is the largest and longest. Real estate prices impact on inflation is significant, and the effect of policies slow long time lag. Inflation itself has the inertia and fluctuation .The influence between GDP gap and inflation is not very large but has the long duration. The influence between marginal cost and inflation is not significant.
Key Words: The new Keynes doctrine; Phillips mixture model; Inflation Expectation; Inflation