2017, Volume 70 - Issue 3
RSS feed citation: At RePEc
Publication date: 01 August 2017
ASYMMETRIC EFFECT OF REAL EXCHANGE RATE VOLATILITY ON AGRICULTURAL PRODUCTS EXPORT: A CASE STUDYRead the article
FACTORS INFLUENCING INTER-REGIONAL LIVING-COST DIFFERENTIALS: PANEL DATA ANALYSIS FOR THE CASE OF THE U.S.Read the article
HOW MUCH INEQUALITY IS HARMFUL FOR GROWTH? THE GROWTH MAXIMIZING RATE OF INEQUALITY IN THE CONTEXT OF THE MEXICAN ECONOMYRead the article
PROCYCLICAL TENDENCIES IN A SMALL OIL EXPORTERRead the article
WHEN IS LOWER INFLATION LESS STABLE? EVIDENCE FROM EIGHT DEVELOPING ECONOMIESRead the article
INDIA'S BURGEONING FOOD SUBSIDIES: HOW MUCH CAN WE BLAME THE FOOD CORPORATION OF INDIA?Read the article
Georgios KARRAS, University of Illinois at Chicago, Illinois, USA
This paper investigates the relationship between inflation and inflation volatility in eight developing economies. Using monthly data for Chile, China, India, Indonesia, Korea, Poland, South Africa, and Turkey, the results show that inflation and its volatility have been positively correlated when inflation exceeds a certain value, but negatively correlated when inflation is below this threshold. The evidence also suggests that inflation volatility is minimized at inflation rates that differ across the countries, ranging from roughly 3% in South Africa to 12% in Turkey, a range which includes both the 3.5% break point predicted by the New Keynesian model of Coibion et al. (2012) and the 4% inflation target recommended by Ball (2013) and Krugman (2013), but not the (formal or informal) 2% inflation target of many central banks.
Inflation, Inflation Volatility, Trend Inflation
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