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Title: |
Inflation Convergence in the ERM: Evidence for Manufacturing and
Services |
| Author: |
Holmes, Mark J. |
| Author
Affiliation: |
Loughborough U |
| Source: |
International Economic Journal, Autumn 1998, v. 12, no. 3, pp. 1-16 |
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Publication Date: |
Autumn 1998 |
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Abstract: |
Recent studies have concluded that the ERM
has facilitated some degree of inflation convergence among its members
with limited evidence of German leadership. These conclusions are based
on rational inflation measures which reflect aggregated output thereby
masking different experiences at the sectoral level. This study examines
inflation convergence in the ERM for manufacturing and service sector
output using time-varying parameter analysis, common trends analysis and
tests for weak exogeneity. For both sectors, there is no evidence of
German leadership. Inflation convergence in manufacturing inflation,
though limited, is more advanced than in services. |
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