Working Paper

The openness-inflation puzzle revisited

Abstract: Dynamic panel estimates show the negative relation between trade openness and inflation found by Romer (1993) but questioned by Terra (1998) became more robust in the 1990s, both among high income OECD and developing countries. Also during the 1990s, openness was associated with less variable inflation and had a stronger disinflation effect in economies with floating exchange rates.

Keywords: Trade;

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Bibliographic Information

Provider: Federal Reserve Bank of Dallas

Part of Series: Center for Latin America Working Papers

Publication Date: 2003

Number: 0203