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Can the facts of UK inflation persistence be explained by nominal rigidity?

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  • Meenagh, David
  • Minford, Patrick
  • Nowell, Eric
  • Sofat, Prakriti
  • Srinivasan, Naveen

Abstract

It has been widely argued that inflation persistence since WWII has been widespread and durable and that it can only be accounted for by models with a high degree of nominal rigidity. We examine UK post-war data where after confirming previous studies' findings of varying persistence due to changing monetary regimes, we find that models with little nominal rigidity are best equipped to explain it.

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Bibliographic Info

Article provided by Elsevier in its journal Economic Modelling.

Volume (Year): 26 (2009)
Issue (Month): 5 (September)
Pages: 978-992

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Handle: RePEc:eee:ecmode:v:26:y:2009:i:5:p:978-992

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Web page: http://www.elsevier.com/locate/inca/30411

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Keywords: Inflation persistence New Keynesian New Classical Nominal rigidity Monetary regime shifts;

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Citations

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Cited by:
  1. Naveen Srinivasan & Pankaj Kumar, 2012. "Inflation Persistence: Does Credibility of the Monetary Regime Matter?," Economics Bulletin, AccessEcon, vol. 32(4), pages 2944-2954.
  2. Vo Phuong Mai Le & Patrick Minford & Michael Wickens, 2009. " The ‘Puzzles’ Methodology: En Route to Indirect Inference?," CDMA Conference Paper Series 0903, Centre for Dynamic Macroeconomic Analysis.
  3. Fan, Jingwen & Minford, Patrick, 2010. "Can the Fiscal Theory of the price level explain UK inflation in the 1970s?," CEPR Discussion Papers 7630, C.E.P.R. Discussion Papers.

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