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The Link between Inflation and Output Variability in Canada: Note

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Author Info
Iscan, Talan
Osberg, Lars

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Abstract

One of the costs of high levels of inflation may be misperceptions of relative prices and excessive volatility in sectoral output. This paper therefore examines the relationship between the level of inflation and sectoral output growth variability in Canada from 1961:1 to 1995:4. Despite the substantial variation in inflation over this period, the authors find little evidence of an impact of the level of inflation on variability of sectoral output growth. Their results indicate that the oil price and the real exchange rate are significantly correlated with the variability of output growth across sectors.

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Publisher Info
Article provided by Blackwell Publishing in its journal Journal of Money, Credit and Banking.

Volume (Year): 30 (1998)
Issue (Month): 2 (May)
Pages: 261-72
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Handle: RePEc:mcb:jmoncb:v:30:y:1998:i:2:p:261-72

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Web page: http://www.blackwellpublishing.com/journal.asp?ref=0022-2879

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  1. Nicholas Apergis & Stephen M. Miller, 2007. "Total Factor Productivity and Monetary Policy: Evidence from Conditional Volatility," Working papers 2007-06, University of Connecticut, Department of Economics. [Downloadable!]
    Other versions:
  2. Mustafa Caglayan & Feng Jiang, 2006. "Reexamining the linkages between inflation and output growth: A bivariate ARFIMA-FIGARCH approach," Working Papers 2006_8, Department of Economics, University of Glasgow. [Downloadable!]
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