What is behind the change in the gap between services price inflation and goods price inflation?

Luigi Ferrara

Economic Bulletin Boxes, 2019, vol. 5

Abstract: Services price inflation tends to be much higher than non-energy goods price inflation. However, the gap between the two has become smaller since the financial crisis. This phenomenon has coincided with the corresponding decline in the gap between unit labour cost growth in the services sector and manufacturing, driven by the decline in unit labour cost growth in the services sector. Overall, the narrowing of the gap between services price inflation and goods price inflation has been a major feature of lower HICP inflation excluding food and energy. However, this measure of underlying inflation would have declined even more had the weight of the services component not changed. JEL Classification: E31, C43, O47

Keywords: Balassa-Samuelson effect; goods price inflation; services price inflation (search for similar items in EconPapers)
Date: 2019-08
References: Add references at CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://www.ecb.europa.eu//pub/economic-bulletin/f ... 5~c78bb049be.en.html (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ecb:ecbbox:2019:0005:5

Access Statistics for this article

More articles in Economic Bulletin Boxes from European Central Bank 60640 Frankfurt am Main, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Official Publications ().