Inflation Differentials in the GCC Does the Oil Cycle Matter?

This paper uses a pairwise approach to investigate the main factors that have been driving inflation differentials in the Gulf Cooperation Council (GCC) region for the past two decades. The results suggest that inflation differentials in the GCC are largely influenced by the oil cycle, mainly throug...

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Bibliographic Details
Main Author: Williams, Oral
Other Authors: Mohaddes, Kamiar
Format: eBook
Language:English
Published: Washington, D.C. International Monetary Fund 2011
Series:IMF Working Papers
Subjects:
Online Access:
Collection: International Monetary Fund - Collection details see MPG.ReNa
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651 4 |a Saudi Arabia 
653 |a Fiscal stance 
653 |a Price indexes 
653 |a Inflation 
653 |a Credit 
653 |a Dynamic Treatment Effect Models 
653 |a Monetary economics 
653 |a Deflation 
653 |a Monetary Policy, Central Banking, and the Supply of Money and Credit: General 
653 |a Fiscal Policy 
653 |a Consumer price indexes 
653 |a Currency 
653 |a Diffusion Processes 
653 |a Fiscal policy 
653 |a Nominal effective exchange rate 
653 |a Money 
653 |a Time-Series Models 
653 |a Price Level 
653 |a Foreign Exchange 
653 |a Multiple or Simultaneous Equation Models: Models with Panel Data 
653 |a Prices 
653 |a Macroeconomics 
653 |a Dynamic Quantile Regressions 
653 |a State Space Models 
653 |a Money and Monetary Policy 
653 |a Foreign exchange 
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520 |a This paper uses a pairwise approach to investigate the main factors that have been driving inflation differentials in the Gulf Cooperation Council (GCC) region for the past two decades. The results suggest that inflation differentials in the GCC are largely influenced by the oil cycle, mainly through the credit and fiscal channels. This implies that closer coordination of fiscal policies will be key for facilitating the closer integration of the GCC economies and ahead of the move to a monetary union. The results also indicate that after controlling for cyclical factors, convergence increased even during the recent oil boom