Globalisation and the Slope of the Phillips Curve

Emanuel Kohlscheen and Richhild Moessner

No 9383, CESifo Working Paper Series from CESifo

Abstract: We study the effects of globalisation on the slope of the New Keynesian Phillips curve for CPI inflation, based on a broad panel of 35 countries and controlling for possibly non-linear exchange rate effects. We find that the output gap generally has a significant positive effect on inflation, but that this effect decreases as integration in the global economy increases. We conclude that the advance of globalisation has been a key force behind the flattening of price Phillips curves across the world.

Keywords: inflation; globalisation; openness; output gap; Phillips curve (search for similar items in EconPapers)
JEL-codes: E52 E58 (search for similar items in EconPapers)
Date: 2021
New Economics Papers: this item is included in nep-cwa, nep-int, nep-mac and nep-mon
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Journal Article: Globalisation and the slope of the Phillips curve (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_9383

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