Inflation and globalisation: a modelling perspective
نویسنده
چکیده
This paper examines some standard open-economy New Keynesian models to address the question of how globalisation affects the inflation process. Specifically, it investigates how the Phillips curve for consumer price inflation in a country is affected by openness, and how the optimal choice of monetary policy is influenced by openness. The paper compares models that assume producer currency pricing with ones that assume local currency pricing. It also considers the role of financial market completeness.
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