Quah, Danny and Vahey, Shaun P (1995) Measuring core inflation. Econometrics; EM/1995/282 (EM/1995/282). Suntory and Toyota International Centres for Economics and Related Disciplines, London, UK.
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: | Monograph (Discussion Paper) |
|---|---|
| Official URL: | http://sticerd.lse.ac.uk |
| Additional Information: | © 1995 the authors |
| Divisions: | Centre for Economic Performance Economics |
| Subjects: | H Social Sciences > HB Economic Theory |
| Date Deposited: | 27 Apr 2007 |
| Last Modified: | 15 Sep 2023 22:42 |
| URI: | http://eprints.lse.ac.uk/id/eprint/2080 |
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