The empirical results of the IPN are based on a new dataset in which national micro data were a key ingredient. By incorporating real wage rigidities into a New Keynesian Phillips curve, the network also demonstrates that inflation persistence in the euro area (moderate as it is) is partly generated by developments in the labour market.
I am therefore looking forward to the research results of the IPN’s springoff – the Eurosystem’s Wage Dynamic Network. But back to the original subject: The successful anchoring of inflation expectations and the more effective monetary policy response to inflationary shocks will both show up in a flattened Phillips curve when it is estimated in reduced form.