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Disinflation in Spain The Recent Experience

This paper investigates the causes of the recent disinflation in Spain. A standard Phillips curve model is used to disentangle the contributions of three possible shocks: an adverse demand shock that raises unemployment, a positive supply shock resulting from relative price adjustments or structural...

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Bibliographic Details
Main Author: Sobczak, Nicolas
Format: eBook
Language:English
Published: Washington, D.C. International Monetary Fund 1998
Series:IMF Working Papers
Subjects:
Inflation
Real Wages
Labour
Output Gap
Wages, Compensation, And Labor Costs: General
Deflation
Production
Disinflation
Prices, Business Fluctuations, And Cycles: Forecasting And Simulation
Labor
Macroeconomics: Production
Price Level
Wages, Compensation, And Labor Costs: Public Policy
Prices
Macroeconomics
Wages
Economic Theory
Income Economics
Wage Bargaining
Production And Operations Management
Spain
Online Access:
Collection: International Monetary Fund - Collection details see MPG.ReNa
Description
Summary:This paper investigates the causes of the recent disinflation in Spain. A standard Phillips curve model is used to disentangle the contributions of three possible shocks: an adverse demand shock that raises unemployment, a positive supply shock resulting from relative price adjustments or structural improvements in the labor market, and a credibility shock that lowers inflationary expectations. The main element underlying Spain’s recent disinflation appears to be a fall in inflation expectations, thanks to the country’s commitment to participate in Economic and Monetary Union from the start, and policy actions geared to that end
Physical Description:30 pages
ISBN:9781451852868

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