The impact of the European Monetary Union on inflation persistence in the Euro area
Meller, Barbara ;  Nautz, Dieter ;  Universität <Berlin, Freie Universität> / Fachbereich Wirtschaftswissenschaft

Main titleThe impact of the European Monetary Union on inflation persistence in the Euro area
AuthorMeller, Barbara
AuthorNautz, Dieter
InstitutionUniversität <Berlin, Freie Universität> / Fachbereich Wirtschaftswissenschaft
No. of Pages20 S.
Series Diskusssionsbeiträge des Fachbereichs Wirtschaftswissenschaft ; 2009/8 : Economics
KeywordsMonetary Policy Effectiveness and Inflation Persistence; Panel Test for Fractional Integration; Change in Inflation Persistence
Classification (DDC)332 Financial economics
337 International economics
AbstractThis paper uses the European Monetary Union (EMU) as a natural
experiment to investigate whether more effective monetary policy reduces
the persistence of inflation. Taking into account the fractional
integration of inflation, we confirm that inflation dynamics differed considerably
across Euro area countries before the start of EMU. Since
1999, however, results obtained from panel estimation indicate that
the degree of long run inflation persistence has converged. In line with
theoretical predictions, we find that the persistence of inflation has significantly decreased in the Euro area probably as a result of the more
effective monetary policy of the ECB.
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FU DepartmentDepartment Business and Economics
Other affiliation(s)Institut für Statistik und Ökonometrie
Year of publication2009
Type of documentBook
Terms of use/Rights Nutzungsbedingungen
Created at2009-07-08 : 12:30:53
Last changed2015-01-22 : 04:40:24
Static URLhttp://edocs.fu-berlin.de/docs/receive/FUDOCS_document_000000002537