Is inflation rate a stationary process?
Using conventional unit root tests, like Augmented Dickey Fuller (ADF) and Phillips-Perron (PP) test, we conclude on contradictory results as far as inflation rates and unit roots are concerned. We can see this from various researches that used such tests. In this paper, we will try to focus on the problems which lead to these contradictory results about unit root and inflation and to propose ideal modifications of these tests that have come out in the literature and seem to correct these problems. Our aim is to use such a modification of the tests so as to reach valid results and get the real behavior of inflation rates.