The determinants of inflation differentials in the euro area

Laura Moretti ()

No 451, CFS Working Paper Series from Center for Financial Studies (CFS)

Abstract: Inflation differentials in the euro area have been persistent since the adoption of the single currency. This paper analyzes the impact of product and labor market regulation on inflation in a sample of 11 countries. The results show that, after the adoption of the euro, product market deregulation has a relevant and significant effect on the level of inflation, while higher labor market regulation increases the responsiveness of inflation to the output gap.

Keywords: Labor Market Deregulation; Product Market Deregulation; EMU; Inflation Rate (search for similar items in EconPapers)
JEL-codes: E31 E58 E65 L51 (search for similar items in EconPapers)
Date: 2014
New Economics Papers: this item is included in nep-cba, nep-eec, nep-mac and nep-mon
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:cfswop:451

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