Testing for stationarity of inflation in Central and Eastern European Countries
Juan Cuestas and
NBS Discussion Papers in Economics from Economics, Nottingham Business School, Nottingham Trent University
In this paper we provide an insight into the inflation dynamics in a panel of Central and Eastern European countries. These countries are selected because of their increasing importance in the EU and their likely increased future importance in monetary policy decisions inside the euro area. By means of unit root testing and allowing for the possibility of a smooth asymmetric adjustment to equilibrium, we show that inflation rates in more than half of the countries investigated are stationary processes. Our results imply evidence against the persistence hypothesis for them.
Keywords: Inflation persistence; Unit roots; Nonlinearities (search for similar items in EconPapers)
JEL-codes: C22 E31 E32 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cba, nep-eec, nep-mac, nep-mon and nep-tra
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Persistent link: https://EconPapers.repec.org/RePEc:nbs:wpaper:2008/13
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