Cookies?
Library Header Image
LSE Research Online LSE Library Services

Measuring core inflation

Quah, Danny and Vahey, Shaun P. (1995) Measuring core inflation. Economic Journal, 105 (432). pp. 1130-1144. ISSN 0013-0133

Full text not available from this repository.

Abstract

In this paper, we argue that measured (RPI) inflation is conceptually mismatched with core inflation: the difference is more than just ‘measurement error’. We propose a technique for measuring core inflation, based on an explicit long-run economic hypothesis. Core inflation is defined as that component of measured inflation that has no (medium-to) long-run impact on real output - a notion that is consistent with the vertical long-run Phillips curve interpretation of the comovements in inflation and output. We construct a measure of core inflation by placing dynamic restrictions on a vector autoregression (VAR) system.

Item Type: Article
Additional Information: © 1995 Royal Economic Society
Library of Congress subject classification: H Social Sciences > HB Economic Theory
Journal of Economic Literature Classification System: E - Macroeconomics and Monetary Economics > E3 - Prices, Business Fluctuations, and Cycles > E31 - Price Level; Inflation; Deflation
Sets: Departments > Economics
Research centres and groups > LSE IDEAS
Collections > Economists Online
Research centres and groups > Centre for the Study of Human Rights
Rights: http://www.lse.ac.uk/library/usingTheLibrary/academicSupport/OA/depositYourResearch.aspx
Date Deposited: 27 Apr 2007
URL: http://eprints.lse.ac.uk/1141/

Actions (login required)

Record administration - authorised staff only Record administration - authorised staff only