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Deflation and depression: is there an empirical link?

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  • Andrew Atkeson
  • Patrick J. Kehoe

Abstract

Are deflation and depression empirically linked? No, concludes a broad historical study of inflation and real output growth rates. Deflation and depression do seem to have been linked during the 1930s. But in the rest of the data for 17 countries and more than 100 years, there is virtually no evidence of such a link.

Suggested Citation

  • Andrew Atkeson & Patrick J. Kehoe, 2004. "Deflation and depression: is there an empirical link?," Staff Report 331, Federal Reserve Bank of Minneapolis.
    • Handle: RePEc:fip:fedmsr:331
    DOI: 10.21034/sr.331
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    References listed on IDEAS

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    1. Ron Leung & Harold L. Cole & Lee E. Ohanian, 2004. "Deflation, Real Wages, and the International Great Depression: A Productivity Puzzle," Econometric Society 2004 North American Winter Meetings 75, Econometric Society.
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    7. Andrew Atkeson & Patrick J. Kehoe, 2000. "Paths of development for early- and late-bloomers in a dynamic Heckscher-Ohlin model," Staff Report 256, Federal Reserve Bank of Minneapolis.
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    Keywords

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    JEL classification:

    • E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy

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    1. Deflazione (economia) in Wikipedia Italian

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