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Regional Inflation in China


  • Nagayasu, Jun


This paper empirically examines developments in price and inflation in China from 1991 to 2005. Unlike most previous studies, their determinants were investigated in the panel data context, and our findings are as follows. First, using the panel cointegration method, we confirm a long-run relationship between price, money and output. Secondly, we provide evidence that inflation can be explained by economic fundamentals such as money, credits, productivity, and exchange rate growth. Furthermore, while an increased concern about regional discrepancies in recent years, this relationship is more sensitive to the sample period than to the region type. Notably, money does not seem to be closely associated with inflation over recent years.

Suggested Citation

  • Nagayasu, Jun, 2009. "Regional Inflation in China," MPRA Paper 24722, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:24722

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    References listed on IDEAS

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    Cited by:

    1. Marlene Amstad & Ye Huan & Guonan Ma, 2014. "Developing an underlying inflation gauge for China," BIS Working Papers 465, Bank for International Settlements.

    More about this item


    China; inflation; panel data; panel cointegration;

    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E50 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - General
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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