Li, Carmen A and Philippopoulos, A and Tzavalis, E (1998) Inflation and Exchange Rate Regimes in Mexico. Working Paper. Exeter University, Department of Economics, Discussion Papers, Exeter.
Li, Carmen A and Philippopoulos, A and Tzavalis, E (1998) Inflation and Exchange Rate Regimes in Mexico. Working Paper. Exeter University, Department of Economics, Discussion Papers, Exeter.
Li, Carmen A and Philippopoulos, A and Tzavalis, E (1998) Inflation and Exchange Rate Regimes in Mexico. Working Paper. Exeter University, Department of Economics, Discussion Papers, Exeter.
Abstract
We present a version of the exchange-rate regime model of inflation. We then use quarterly data from Mexico during 1946-1995 to test and estimate a simultaneous equation model for wage inflation, price inflation and industrial produciton. In doing so, we respect the Lucas critique and take into account the statistical properties of the data. The main empirical finding is that after the fall of the fixed exchange rate regime in 1976, there is a Barro-Gordon type inflation bias due to the inability of policy-makers to commit to low inflation.
| Item Type: | Monograph (Working Paper) |
|---|---|
| Uncontrolled Keywords: | Exchange Rate ; Inflation ; Employment ; Mexico |
| Subjects: | H Social Sciences > HB Economic Theory |
| Divisions: | Faculty of Social Sciences > Economics, Department of |
| Depositing User: | Jim Jamieson |
| Date Deposited: | 08 Aug 2012 16:02 |
| Last Modified: | 08 Aug 2012 16:02 |
| URI: | http://repository.essex.ac.uk/id/eprint/3631 |