IDEAS home Printed from
   My bibliography  Save this paper

An analysis of inflation rates in the european union using wavelets: strong evidence against unit roots


  • Ernest Pons Fanals
  • Jordi Surinach Caralt

    (Universitat de Barcelona)


In many fields of economic analysis the order of integration of some economic magnitudes is of particular interest. Among other aspects, the order of integration determines the degree of persistence of that magnitude. The rate of inflation is a very interesting example because many contradictory empirical results on the persistence of inflation rates can be found in the literature. Moreless, the persistence of inflation rates is of particular interest as much for the macro economy as for the taking of political decisions. Recently, Hassler and Wolters (1995) argue that these contradictions may be due to the fact that either process I(0) or I(1) are considered. In this paper we assume inflation rates in European Union countries may in fact be fractionally integrated. Given this assumption, we obtain estimations of the order of integration by means a method based on wavelets coefficients. Finally, results obtained allow reject the unit root hypothesis on inflation rates. It means that a random shock on the rate of inflation in these countries has transitory effects that gradually diminish with the passage of time, that this, said shock hasnt a permanent effect on future values of inflation rates.

Suggested Citation

  • Ernest Pons Fanals & Jordi Surinach Caralt, 2002. "An analysis of inflation rates in the european union using wavelets: strong evidence against unit roots," Working Papers in Economics 81, Universitat de Barcelona. Espai de Recerca en Economia.
  • Handle: RePEc:bar:bedcje:200281

    Download full text from publisher

    File URL:
    Download Restriction: no

    References listed on IDEAS

    1. Robin L. Lumsdaine & David A. Wise, 1994. "Aging and Labor Force Participation: A Review of Trends and Explanations," NBER Chapters,in: Aging in the United States and Japan: Economic Trends, pages 7-42 National Bureau of Economic Research, Inc.
    2. William A. Jackson, 1998. "The Political Economy of Population Ageing," Books, Edward Elgar Publishing, number 765.
    3. Michael D. Hurd, 1993. "The Effect of Labor Market Rigidities on the Labor Force Behavior of Older Workers," NBER Working Papers 4462, National Bureau of Economic Research, Inc.
    4. Posner, Richard A., 1995. "Aging and Old Age," University of Chicago Press Economics Books, University of Chicago Press, edition 1, number 9780226675664, March.
    5. Moen, Jon, 1987. "The Labor of Older Men: A Comment," The Journal of Economic History, Cambridge University Press, vol. 47(03), pages 761-767, September.
    6. Chulhee Lee, 2009. "Labor Force Participation of Older Males in Korea: 1955-2005," NBER Working Papers 14800, National Bureau of Economic Research, Inc.
    7. Peter Lindert, 2004. "Social Spending and Economic Growth," Challenge, Taylor & Francis Journals, vol. 47(4), pages 6-16.
    Full references (including those not matched with items on IDEAS)

    More about this item

    JEL classification:

    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • E3 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bar:bedcje:200281. 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: (Espai de Recerca en Economia). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.