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Long-run impacts of inflation across sectors in a small sample of countries

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  • David Hineline

Abstract

This article investigates the long-run effects of inflation on economic output for 10 sectors of the economy, with a sample of 7 countries. The analysis is done using long-run restrictions in a vector autoregression and reports long-run multipliers with bootstrapped confidence bands. The results suggest that some sectors seem to be affected differently than others, as well as significant heterogeneity across countries. The results suggest the strongest effects in the low inflation countries Germany and Japan as has been found in similar studies. In contrast to research using growth regressions, the evidence suggests a positive long-run effect of inflation on output.

Suggested Citation

  • David Hineline, 2010. "Long-run impacts of inflation across sectors in a small sample of countries," Applied Economics, Taylor & Francis Journals, vol. 42(10), pages 1197-1207.
    • Handle: RePEc:taf:applec:v:42:y:2010:i:10:p:1197-1207
    DOI: 10.1080/00036840701721307
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    References listed on IDEAS

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    1. Dedola, Luca & Lippi, Francesco, 2005. "The monetary transmission mechanism: Evidence from the industries of five OECD countries," European Economic Review, Elsevier, vol. 49(6), pages 1543-1569, August.
    2. By Mohsin S. Khan & Abdelhak S. Senhadji, 2001. "Threshold Effects in the Relationship Between Inflation and Growth," IMF Staff Papers, Palgrave Macmillan, vol. 48(1), pages 1-1.
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    Cited by:

    1. Muhammad Ayyoub & Julia Wörz, 2021. "Inflation‐growth nexus in developing economies: New empirical evidence from a disaggregated approach," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 26(1), pages 241-257, January.

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