Heterogeneity and convergence of regional inflation (prices)

Research output: Contribution to journalArticlepeer-review

10 Citations (Scopus)

Abstract

It is generally thought that members in a monetary union experience a similar level of inflation. This paper verifies this conventional belief. Using regional data, we present statistical evidence of heterogeneous inflation in Japan. Not only does the average inflation differ significantly across regions, but regional inflation responds differently to common economic and monetary factors. Furthermore, we show no evidence of price convergence in the entire group of regions although there is some evidence of convergence in subgroups. These results suggest that diversified regional inflation can exist within a monetary union.

Original languageEnglish
Pages (from-to)711-723
Number of pages13
JournalJournal of Macroeconomics
Volume33
Issue number4
DOIs
Publication statusPublished - 2011 Dec
Externally publishedYes

Keywords

  • Convergence
  • Factor models
  • Monetary policy
  • Regional inflation

ASJC Scopus subject areas

  • Economics and Econometrics

Fingerprint Dive into the research topics of 'Heterogeneity and convergence of regional inflation (prices)'. Together they form a unique fingerprint.

Cite this