Openness and Inflation: Theory and Evidence
نویسندگان
چکیده
منابع مشابه
Openness and Inflation: Theory and Evidence*
Because unanticipated monetary expansion leads to real exchange rate depreciation, and because the harms of real depreciation are greater in more open economies, the benefits of unanticipated expansion are decreasing in the degree of openness. Models in which the absence of precommitment in monetary policy leads to excessive inflation therefore predict lower average inflation in more open econo...
متن کاملOpenness and inflation volatility: Panel data evidence
Trade openness can reduce inflation volatility through limiting recourse to seigniorage during periods of temporary fiscal deficits, and by shifting consumption and production towards goods for which the terms of trade are relatively stable. This paper provides evidence for a negative effect of openness on inflation volatility using a dynamic panel model that controls for the endogeneity of ope...
متن کاملOpenness and Inflation∗
A general equilibrium model of a small open economy is developed to analyze the optimal rate of inflation under discretion. Once agents’ welfare is the sole policy objective it is possible to show that openness and inflation no longer have a simple inverse relationship. A greater degree of openness may lead the policy maker to want to exploit the short-run Phillips curve more aggressively, even...
متن کاملInflation and Growth: Some Theory and Evidence
The paper presents a monetary model of endogenous growth and specifies an econometric model consistent with it. The economic model suggests a negative inflation-growth effect, and one that is stronger at lower levels of inflation. Empirical evaluation of the model is based on a large panel of OECD and APEC member countries over the years 1961-1997. The hypothesized negative inflation effect is ...
متن کاملInflation in Ireland: Theory and Evidence
The purpose of this paper is to address some important questions surrounding the determinants of Irish inflation. As a backdrop, the international theoretical literature on inflation is selectively reviewed, with a view towards assessing its relevance to Ireland. Subsequently, the relevant Irish empirical literature is assessed in order to highlight the main outstanding areas of disagreement su...
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ژورنال
عنوان ژورنال: The Quarterly Journal of Economics
سال: 1993
ISSN: 0033-5533,1531-4650
DOI: 10.2307/2118453