GLOBALIZATION AND INFLATION: NEW PANEL EVIDENCE
- Authors
- Kim, Dong-Hyeon; Lin, Shu-Chin; Wu, Yi-Chen
- Issue Date
- 1월-2016
- Publisher
- CAMBRIDGE UNIV PRESS
- Keywords
- Trade Openness; Financial Openness; Inflation; Cross-Section Dependence; Heterogeneous Panels
- Citation
- MACROECONOMIC DYNAMICS, v.20, no.1, pp.1 - 26
- Indexed
- SSCI
SCOPUS
- Journal Title
- MACROECONOMIC DYNAMICS
- Volume
- 20
- Number
- 1
- Start Page
- 1
- End Page
- 26
- URI
- https://scholar.korea.ac.kr/handle/2021.sw.korea/90003
- DOI
- 10.1017/S1365100514000510
- ISSN
- 1365-1005
- Abstract
- Recent empirical work on globalization and inflation analyzes multicountry data sets in panel and/or cross-section frameworks and reaches inconclusive results. This paper highlights their shortcomings and reexamines the issue utilizing heterogeneous panel cointegration techniques that allow for cross-section heterogeneity and dependence. It finds that in a sample of developing countries globalization of both trade and finance, on the average, exerts a significant and positive effect on inflation, whereas in a sample of developed countries there is, on the average, no significant impact of openness. Neither type of openness disciplines inflationary policy. Despite this, there are large variations in the effect across countries, due possibly to differences in the quality of political institutions, central bank independence, the exchange-rate regimes, financial development, and/or legal traditions.
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- Appears in
Collections - College of Life Sciences and Biotechnology > Department of Food and Resource Economics > 1. Journal Articles
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