On price convergence in Eurozone - Archive ouverte HAL
Pré-Publication, Document De Travail Année : 2011

On price convergence in Eurozone

David Guerreiro
  • Fonction : Auteur
  • PersonId : 991177
Valérie Mignon
  • Fonction : Auteur
  • PersonId : 1016632

Résumé

We investigate price level convergence with Germany in eleven countries belonging to the Eurozone between January 1970 and July 2011. Relying on smooth transition regression models, we show that the price convergence process is nonlinear, depending on the size of the price differential: for most countries, price convergence occurs only when price differentials with Germany exceed a certain threshold. Moreover, our findings put forward some heterogeneity across the Eurozone members in terms of price convergence speed, that can be explained by the evolution of price-competitiveness, rigidities in labor markets, but also by specialization patterns.
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hal-04140947 , version 1 (26-06-2023)

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  • HAL Id : hal-04140947 , version 1

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David Guerreiro, Valérie Mignon. On price convergence in Eurozone. 2011. ⟨hal-04140947⟩
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