Mind the Gap: City-Level Inflation Synchronization / Serhan Cevik.

Format:

Book

Government document

Author/Creator:

Cevik, Serhan.

Series:

IMF Working Papers; Working Paper ; No. 2022/166

IMF Working Papers

Language:

English

Physical Description:

1 online resource (17 pages)

Other Title:

Mind the Gap

Place of Publication:

Washington, D.C. : International Monetary Fund, 2022.

Summary:

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.

Notes:

Description based on print version record.

ISBN:

9798400219610