Description |
1 online resource (37 pages) |
Series |
IMF Working Papers; Working Paper, 1018-5941 ; No. 92/88 |
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IMF Working Papers; Working Paper ; no. 92/88
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Summary |
This paper examines the comovement of prices with the cyclical component of output. It argues that determining the cyclical behavior of prices by applying the same stationarity-inducing transformation to the levels of both output and prices, and examining the correlations of the resulting series, can be misleading. A more appropriate procedure is to examine the correlations between the rate of inflation and the level of the cyclical component of output. In post-war U.S. data the correlations between similarly transformed price and output data are consistently and often strongly negative, as reported recently by a number of authors as evidence of countercyclical price behavior. The rate of inflation, however, is consistently and usually strongly positively correlated with various measures of the cyclical component of output |
Notes |
Print version record |
Subject |
Correlation.
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Correlations.
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Price Level.
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Rate of Inflation.
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United States.
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Form |
Electronic book
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Author |
Chadha, Bankim
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Prasad, Eswar
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ISBN |
1451851073 |
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9781451851076 |
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