Mind the gap: city-level inflation synchronization.
Int Rev Econ
; 70(1): 121-139, 2023.
Article
in English
| MEDLINE | ID: covidwho-2254142
ABSTRACT
The post-pandemic rise in consumer prices across the world has renewed interest in inflation dynamics after decades of global disinflation. This paper provides a spatial investigation of inflation synchronicity at the city level in Lithuania using disaggregated monthly data during the period 2000-2021. The empirical analysis provides strong evidence that (i) the co-movement of city-level inflation rates-estimated using the instantaneous quasi-correlation approach-is significantly weaker than the extent of synchronization suggested by the simple correlation analysis; (ii) there is substantial heterogeneity in the instantaneous quasi-correlation of inflation subcomponents between city pairs; and (iii) there are significant changes in the degree of city-level synchronization over time, reflecting important economic developments in history such as the global financial crisis, the adoption of euro, and the COVID-19 pandemic.
Full text:
Available
Collection:
International databases
Database:
MEDLINE
Type of study:
Prognostic study
Language:
English
Journal:
Int Rev Econ
Year:
2023
Document Type:
Article
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