Relative Price Variability and Inflation: Evidence from US Cities

Guy Debelle () and Owen Lamont

No 5627, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We test whether the time-series positive correlation of inflation and intermarket relative price variability is also present in a cross-section of US cities. We find this correlation to be a robust empirical regularity: cities which have higher than average inflation also have higher than average relative price dispersion, ceteris paribus. This result holds for different periods of time, different classes of goods, and across different time horizons. Our results suggest that at least part of the relationship between inflation and relative price variability cannot be explained by monetary factors.

JEL-codes: E31 (search for similar items in EconPapers)
Date: 1996-06
Note: ME
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

Published as Journal of Political Economy Feb.1997, Vol. 105, No. 1, pp. 132-152

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