Openness, Inflation, and the Phillips Curve: A Puzzle
Models of open economies with nominal rigidities are often thought to predict a correlation between openness to trade and the slope of the output-inflation trade-off, or Phillips curve. Using a variety of measures of the trade-off and a standard measure of openness, this paper argues that the direct evidence for a correlation is not strong. In turn, this calls into question the usual explanation for the negative correlation between openness and inflation that was documented by Romer (1993). The paper considers some alternative explanations for the Romer evidence.
To our knowledge, this item is not available for
download. To find whether it is available, there are three
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
Volume (Year): 34 (2002)
Issue (Month): 2 (May)
|Contact details of provider:|| Web page: http://www.blackwellpublishing.com/journal.asp?ref=0022-2879|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- David Romer, 1991.
"Openness and Inflation: Theory and Evidence,"
NBER Working Papers
3936, National Bureau of Economic Research, Inc.
- Eichenbaum, Martin & Evans, Charles L, 1995. "Some Empirical Evidence on the Effects of Shocks to Monetary Policy on Exchange Rates," The Quarterly Journal of Economics, MIT Press, vol. 110(4), pages 975-1009, November.
- Michael Bruno & Jeffrey D. Sachs, 1985. "Economics of Worldwide Stagflation," NBER Books, National Bureau of Economic Research, Inc, number brun85-1, 07.
- James G. MacKinnon & Halbert White, 1983.
"Some Heteroskedasticity Consistent Covariance Matrix Estimators with Improved Finite Sample Properties,"
537, Queen's University, Department of Economics.
- MacKinnon, James G. & White, Halbert, 1985. "Some heteroskedasticity-consistent covariance matrix estimators with improved finite sample properties," Journal of Econometrics, Elsevier, vol. 29(3), pages 305-325, September.
- Barro, Robert J & Gordon, David B, 1983.
"A Positive Theory of Monetary Policy in a Natural Rate Model,"
Journal of Political Economy,
University of Chicago Press, vol. 91(4), pages 589-610, August.
- Robert J. Barro & David B. Gordon, 1981. "A Positive Theory of Monetary Policy in a Natural-Rate Model," NBER Working Papers 0807, National Bureau of Economic Research, Inc.
- David Romer, 1998. "A New Assessment Of Openness And Inflation: Reply," The Quarterly Journal of Economics, MIT Press, vol. 113(2), pages 649-652, May.
- Hardouvelis, Gikas A., 1992.
"Monetary policy games, inflationary bias, and openness,"
Journal of Economic Dynamics and Control,
Elsevier, vol. 16(1), pages 147-164, January.
- Hardouvelis, G.A., 1988. "Monetary Policy Games, Inflationary Bias And Openness," Papers fb-_88-17, Columbia - Graduate School of Business.
- Barry, F., 1998. "Openness and the Cost of Relinquishing the Exchange Rate," Papers 98/15, College Dublin, Department of Political Economy-.
- Rogoff, Kenneth, 1985. "Can international monetary policy cooperation be counterproductive?," Journal of International Economics, Elsevier, vol. 18(3-4), pages 199-217, May.
- Dornbusch, Rudiger, 1976. "Expectations and Exchange Rate Dynamics," Journal of Political Economy, University of Chicago Press, vol. 84(6), pages 1161-76, December.
- Cristina T. Terra, 1998.
"Openness And Inflation: A New Assessment,"
The Quarterly Journal of Economics,
MIT Press, vol. 113(2), pages 641-648, May.
- Gonzaga, Gustavo M. & Terra, Maria Cristina T., 1997. "Equilibrium real exchange rate, volatility, and stabilization," Journal of Development Economics, Elsevier, vol. 54(1), pages 77-100, October.
- Maurice Obstfeld & Kenneth S. Rogoff, 1996. "Foundations of International Macroeconomics," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262150476, June.
- Thomas Jordan, 1997. "Disinflation costs, accelerating inflation gains, and central bank independence," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 133(1), pages 1-21, March.
- Frank Harrigan & Peter G. McGregor & Kim Swales & Ya Ping Yin, 1993. "Openness, Imperfect Competition and the NAIRU," Journal of Economic Studies, Emerald Group Publishing, vol. 20(1/2), pages 52-72, January.
- Lane, Philip R., 1997. "Inflation in open economies," Journal of International Economics, Elsevier, vol. 42(3-4), pages 327-347, May.
This item is featured on the following reading lists or Wikipedia pages:
- Openness, Inflation, and the Phillips Curve: A Puzzle (JMCB 2002) in ReplicationWiki
When requesting a correction, please mention this item's handle: RePEc:mcb:jmoncb:v:34:y:2002:i:2:p:450-68. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing)or (Christopher F. Baum)
If references are entirely missing, you can add them using this form.