Intercountry Differences in the Relationship between Relative Price Variability and Average Prices

Posted: 25 Apr 2001

See all articles by Mick Silver

Mick Silver

International Monetary Fund (IMF)

Christos Ioannidis

University of Bath-Department of Economics

Abstract

This paper provides new evidence on the relationship between relative price variability and inflation. The model uses a consistently defined data set for nine European countries. It benefits from the inclusion and testing of the effects of macroeconomic variables and the incorporation into the measures of inflation and dispersion adjustments for timeliness, appropriate formulas, and proximity. The general findings of an effect on relative price variability by the macroeconomic environment and negative coefficients on unexpected inflation are supported by their occurrence in models estimated by seemingly unrelated regression and generalized least squares as well as a robust systems estimator.

Suggested Citation

Silver, Mick and Ioannidis, Christos, Intercountry Differences in the Relationship between Relative Price Variability and Average Prices. Available at SSRN: https://ssrn.com/abstract=263450

Mick Silver (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street NW
Washington, DC 20431
United States

Christos Ioannidis

University of Bath-Department of Economics ( email )

Claverton Down
Bath, BA2 7AY
United Kingdom

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