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In: Ekonomický časopis/Journal of Economics, vol. 57, no. 10
Mark J. Holmes

Assessing Inflation Convergence in the European Union: Does Euro Membership Make a Difference?

Details:

Year, pages: 2009, 949 - 962
Keywords: inflation convergence, unit roots, cointegration, pair-wise
Article type: Vedecký článok / Article

About article:

This study offers a new perspective on the debate concerning inflation convergence in the Euro Area. A new pair-wise unit root testing procedure advocated by Pesaran (2007) is employed on all possible bivariate consumer price index differentials. Evidence in favour of long-run convergence is confirmed where the fraction of rejections in favour of stationarity exceeds the size of the individual tests. We find evidence of long-run inflation convergence across the EU though the speed of convergence is lower for current non-Euro Area countries.

This study offers a new perspective on the debate concerning inflation convergence in the Euro Area. A new pair-wise unit root testing procedure advocated by Pesaran (2007) is employed on all possible bivariate consumer price index differentials. Evidence in favour of long-run convergence is confirmed where the fraction of rejections in favour of stationarity exceeds the size of the individual tests. We find evidence of long-run inflation convergence across the EU though the speed of convergence is lower for current non-Euro Area countries.

How to cite:

ISO 690:
Holmes, M. 2009. Assessing Inflation Convergence in the European Union: Does Euro Membership Make a Difference?. In Ekonomický časopis/Journal of Economics, vol. 57, no.10, pp. 949-962. ISSN 0013-3035.

APA:
Holmes, M. (2009). Assessing Inflation Convergence in the European Union: Does Euro Membership Make a Difference?. Ekonomický časopis/Journal of Economics, 57(10), 949-962. ISSN 0013-3035.