Panel data evidence on inflation convergence in the European Union
AbstractThis letter investigates the extent of long-run inflation convergence among the major EU economies using panel data unit root and cointegration tests. Potentially, these methods have key advantages over time-series methods which, in the light of limited data, can suffer from power deficiency with a tendency to accept the null of nonstationarity or noncointegration. Using monthly inflation data over the period 1972-99, this study finds that inflation convergence was strongest during 1983-90 whereas the turbulence experienced within in the ERM in the early 1990s conferred some degree of macroeconomic independence among EU members.
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Bibliographic InfoArticle provided by Taylor & Francis Journals in its journal Applied Economics Letters.
Volume (Year): 9 (2002)
Issue (Month): 3 ()
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