Price Level Convergence and Inflation in Europe PDF Download
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Author: John H. Rogers
Publisher:
ISBN:
Category : Inflation (Finance)
Languages : en
Pages : 0
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Book Description
Author: John H. Rogers
Publisher:
ISBN:
Category : Inflation (Finance)
Languages : en
Pages : 0
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Book Description
Author: John H. Rogers
Publisher:
ISBN:
Category : Convergence (Economics)
Languages : en
Pages : 48
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Book Description
"If price levels are initially different across the euro area, convergence to a common level of prices would imply that inflation will be higher in countries where prices are initially low. Price level convergence thus provides a potential explanation for recent cross-country differences in European inflation, a worrisome development under the ECBs "one-size-fits-all" monetary policy. I present direct evidence on price level convergence in Europe, using a unique data set, and then investigate how much of the recent divergence of national inflation rates can be explained by price level convergence. I show that between 1990 and 1999 prices did become less dispersed in the euro area. Convergence is especially evident for traded goods, and more in the first half of the 1990s than the second half. By some measures, traded goods price dispersion across the euro area is now close to that across U.S. cities. Despite an on-going process of convergence, deviations from the law of one price are large. Finally, I find a statistically-significant and robust negative relationship between the 1999 price level and 2000 inflation rate in Europe, and that the contribution of price level convergence to explaining inflation differentials is often quite important economically. Still, factors other than price convergence explain most of the cross-country inflation differences."
Author: Balázs Égert
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Author: John Harold Rogers
Publisher:
ISBN:
Category : Convergence (Economics)
Languages : en
Pages : 58
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Book Description
Author: Balázs Égert
Publisher:
ISBN:
Category : Housing
Languages : en
Pages : 54
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Book Description
Author:
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Book Description
The U.S. Federal Reserve Board presents the full text of an article entitled "Price Level Convergence, Relative Prices, and Inflation in Europe," by John H. Rogers and published March 2001. The article discusses how price level convergence provides a potential explanation for recent cross-country differences in European inflation.
Author:
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Author: Mr.Tomás Holub
Publisher: INTERNATIONAL MONETARY FUND
ISBN: 9781451854725
Category : Business & Economics
Languages : en
Pages : 0
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Book Description
The paper assesses inflation risks resulting from the convergence of structures of relative prices in Central and Eastern European (CEE) countries toward the European Union (EU). The basic idea of the paper is that under low downward flexibility of domestic nominal prices, the adjustment of relative price structures is likely to lead to higher inflation. The authors find that the degree of differences in the structures of relative prices in transition economies vis-à-vis EU economies has a strong negative relationship to price levels in the transition economies. Based on their calculations, the authors assess the likely future inflationary pressures that can stem from the remaining differences between the structures of relative prices in the CEE economies and the EU. The authors argue that their approach can be thought of as an extension of the standard Balassa-Samuelson explanation of international variability in price levels.
Author: Martin Čihák
Publisher:
ISBN:
Category : Convergence (Economics)
Languages : en
Pages : 52
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Book Description
Author: Paul de Grauwe
Publisher: Oxford University Press
ISBN: 9780198289869
Category : Business & Economics
Languages : en
Pages : 372
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Book Description
The Maastricht Treaty makes the convergence of inflation rates one of the preconditions of European Monetary Union (EMU). The purpose of this study is to shed light on the mechanism underlying the processes that lead to convergence or divergence in national inflation rates. It examinesinflation and wage bahaviour in the European Monetary System (EMS), their determinants, and their implications for the credibility and sustainability of the system's exchange rate mechanism (ERM). Although the focus is on the EMS period, eleven of the twelve studies also review the background of the1970s. The contributors examine issues of monetary control, stability of national and ERM-wide money-demand function, the monetary policy of Germany - the pivotal country in the EMS - and its influence on the stability of the system after the fall of the Berlin Wall. As well as explaining how theEMS worked, the book also offers reasons for its breakdown in 1992-3 under the blow of exogenous shocks and growing policy conflict between member countries.The study identifies several causes of inflation and persistent inflation differentials in the EMS. Among the 'real' causes, particular attention is devoted to sectoral productivity shocks. In some countries, import price shocks, exogenous wage pushes, taxes, and government expenditure are bound tobe important factors. Since theses kinds of shock hit the various economies of the region differently, inflation differntials can persist for several years. The different policies of governments and central banks, and the fact the monetary policies have not always been consistent with the long-runmaintenance of fixed exchange rates, have also played a considerable role in explaining the persistance of inflation differentials.
