Inflation and the Skewness of the Distribution of Relative Price Changes PDF Download
Are you looking for read ebook online? Search for your book and save it on your Kindle device, PC, phones or tablets. Download Inflation and the Skewness of the Distribution of Relative Price Changes PDF full book. Access full book title Inflation and the Skewness of the Distribution of Relative Price Changes by Jörg Döpke. Download full books in PDF and EPUB format.
Author: Jörg Döpke
Publisher:
ISBN:
Category :
Languages : en
Pages : 40
Get Book Here
Book Description
Author: Jörg Döpke
Publisher:
ISBN:
Category :
Languages : en
Pages : 40
Get Book Here
Book Description
Author: Sartaj Rasool Rather
Publisher: LAP Lambert Academic Publishing
ISBN: 9783659414084
Category :
Languages : en
Pages : 60
Get Book Here
Book Description
It widely believed that the rate of inflation in the long run is determined by growth rate of money supply. However, the short run dynamics of inflation is more complicated in nature. The past experience of inflation dynamics shows that the rate of inflation fluctuates around its underlying trend in the short-run. In literature these short-run fluctuations in rate of inflation are mainly attributed to changes in relative prices of certain commodities due to supply shocks. In this context, examining the effects these shocks on the distribution of price changes has gained importance so as to understand these transitory deviations in inflation. In this backdrop, this book examines whether variations in skewness of distribution of relative price changes influence the aggregate inflation.The empirical analysis is carried out by using commodity wise Wholesale Price Index data from India. Further various theoretical paradigms underlying this relationship are also discussed.
Author: Michael F. Bryan
Publisher:
ISBN:
Category : Inflation (Finance)
Languages : en
Pages : 17
Get Book Here
Book Description
Its higher order moments, and in particular, its third moment the skewness of the price change distribution. Evidence on correlations between inflation and its moments goesback over thirty years, and was first used to reject the independence of relative price changes and inflation that is assumed in neo- classical models. More recently, New Keynesian macroeconomists have shown that the strong positive correlation between inflation and the skewness of the price change distribution is consistent with menu-cost models of price setting behavior. This is a fairly controversial result, prompting other researchers to demonstrate that the same correlation can be found in a multi- sector, flexible-price (real business cycle) model. We examine the small-sample properties of the main empirical finding on which this work is based: the positive correlation between the sample mean and sample skewness of price change distributions. Our results show that this particular statistic suffers from a large positive small-sample bias, and demonstrate that the entirety of the observed correlation can be explained by this bias. To the extent that we find any relationship at all, it is that the correlation is negative. In other words, we establish that one of the most accepted stylized facts in the literature on aggregate price behavior, that inflation and the skewness of the price change distribution are positively linked, need not be a fact at all
Author: Scott Roger
Publisher: International Monetary Fund
ISBN:
Category : Business & Economics
Languages : en
Pages : 50
Get Book Here
Book Description
Central banks concerned with inflation performance almost invariably seek to distinguish between a generalized or persistent component of the measured aggregate rate of inflation-driven by demand pressures and expectations-and supply-driven, essentially transitory inflation developments associated with movements in relative prices. The more generalized, persistent element - usually described as core or underlying inflation - is regarded as a legitimate monetary policy concern, while the influence of specific relative price developments are generally regarded as transient distortions that should be largely ignored in forward-looking policy setting, as well as in backward-looking assessment of policy performance.
Author: Nathan S. Balke
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
Get Book Here
Book Description
Inflation is positively correlated with the variability of relative prices as measured by the standard deviation of the cross-section distribution of prices, and also with the third moment (skewness) of the cross-section distribution of prices. The conventional interpretation of these relationships is that they reflect sluggishness in the adjustment of individual prices in response to shocks. In this paper we question this interpretation. First, we show that similar correlations among the moments exist in alternative measures of underlying technology shocks. Second, when these shocks are fed into a general equilibrium model with multiple sectors and flexible prices, the resulting prices also display a positive correlation between aggregate inflation and skewness of the cross-section distribution. Keyword(s): Relative prices; Inflation; Cross-section distribution of prices.
Author: Hiranya K. Nath
Publisher:
ISBN:
Category :
Languages : en
Pages :
Get Book Here
Book Description
This paper estimates a fixed effects regression model using panel data on prices for U.S. cities to test the supply-side theory of inflation that takes the distribution of relative price changes as an aggregate supply shock. The results indicate that the positive correlation between inflation and relative price variability is a robust empirical regularity that gives some credibility to the supplyside theory of inflation. During the early 1980s this relationship, though positive, weakens which indicates predominance of monetary shocks in determining changes in the aggregate price level. On the other hand, inflation and skewness are not found to be strongly related when aggregate macroeconomic effects are controlled.
Author: Andrew M. Smith
Publisher:
ISBN:
Category : Debt-to-equity ratio
Languages : en
Pages : 34
Get Book Here
Book Description
Author: Ms.Sharmini Coorey
Publisher: International Monetary Fund
ISBN: 1451930062
Category : Business & Economics
Languages : en
Pages : 98
Get Book Here
Book Description
In light of the persistence of moderate inflation in many transition economies, this paper analyzes whether inflation resulted from insufficiently tight financial policies and wage pressures or from the protracted adjustment of relative prices. Using a new database for 21 countries, the effect of relative price variability on inflation is estimated within a framework controlling for nominal and real shocks. Money and wage growth were the most important determinants of inflation; relative price variability had a sizable effect at high inflation during initial liberalization and a small effect at moderate inflation. Cost recovery may contribute to variability, particularly in the advanced stages of the transition.
Author: Laurence M. Ball
Publisher:
ISBN:
Category : Inflation (Finance)
Languages : en
Pages : 40
Get Book Here
Book Description
Author:
Publisher: World Bank Publications
ISBN:
Category :
Languages : en
Pages : 45
Get Book Here
Book Description
