Arbeitspapier
Globalization and inflation: The role of China
In this paper, we develop a theoretical model which identifies four channelsimport prices, competition with domestic suppliers and workers, and commodity pricesthrough which priceand wage-setting conditions in country j may affect inflation in country i. We estimate a dynamic inflation equation derived from the theoretical model using a quarterly dataset of eighteen OECD countries over the 1984-2006 period. Although our methodology can be applied to any pair of countries, we focus on the effect of China on the inflation rate of other countries. Our results suggest that while China's negative effect on global inflation has been quantitatively modest, it has increased in absolute terms since the early 2000s. We also find evidence that, for most countries examined, competition with domestic suppliers has been the most important channel.
- Language
-
Englisch
- Bibliographic citation
-
Series: Bank of Canada Working Paper ; No. 2008-35
- Classification
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Wirtschaft
Investment; Capital; Intangible Capital; Capacity
Business Fluctuations; Cycles
Financial Markets and the Macroeconomy
- Subject
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International topics
Globalisierung
Internationale Wirtschaftsbeziehungen
Inflationsübertragung
Import
China
OECD-Staaten
- Event
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Geistige Schöpfung
- (who)
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Côté, Denise
De Resende, Carlos
- Event
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Veröffentlichung
- (who)
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Bank of Canada
- (where)
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Ottawa
- (when)
-
2008
- DOI
-
doi:10.34989/swp-2008-35
- Handle
- Last update
-
15.10.2025, 11:57 PM CEST
Data provider
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Côté, Denise
- De Resende, Carlos
- Bank of Canada
Time of origin
- 2008
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