Identifying domestic and imported core inflation |
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| Authors: | Hilde Christiane Bjørnland |
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| Institution: | 1. College of Business, Honam University , Gwangju 506-714, South Korea shkim@honam.ac.kr;3. Economic Research Team, Gwangju and Jeonnam Branch , Bank of Korea, Gwangju 502-709, South Korea;4. Economics Division , Nanyang Technological University , Singapore;5. Economics and Research Department , Asian Development Bank , Philippines |
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| Abstract: | This paper estimates core inflation in Norway, identified as that component of inflation that has no long-run effect on GDP. The model distinguishes explicitly between domestic and imported core inflation. The results show that (domestic) core inflation is the main component of CPI inflation. However, CPI inflation misrepresents core inflation during some periods. The differences are well explained by the other shocks identified in the model, in particular the oil price shocks of the 1970s when Norway imported inflation, and the negative non-core (supply) shocks of the late 1980s, which pushed inflation up temporarily relative to core inflation. |
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| Keywords: | M& A value creation event study industry characteristics |
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