Domestic and foreign price links in an aggregate supply framework: The case of Greece

• 成果类型: Article
• 署名作者: Moschos, D; Stournaras, Y
• 署名单位: European Central Bank; Bank of Greece; National & Kapodistrian University of Athens
• 刊物名称: JOURNAL OF DEVELOPMENT ECONOMICS
• ISSN/ISSBN: 0304-3878
• DOI: 10.1016/S0304-3878(98)00056-X
• 发表日期: 1998
• 页码: 141-157
• 关键词: supply equation; Real exchange rate; cointegration; homogeneity tests; Purchasing power parity

摘要

Using price and wage equations, an aggregate supply relationship is derived, which relates domestic to foreign prices and output. It is shown that, among all parameters, only the degree of wage indexation matters to the question of whether the nominal exchange rate can affect competitiveness. Cointegration results support the existence of a long-run relationship among the variables of the model which is in conformity with the relationship derived in the theoretical part of the paper. Empirical analysis (a) does not confirm relative Purchase Power Parity for Greek wholesale price indices, and (b) does not contradict the hypothesis that Greek producer prices are homogeneous of degree one in foreign prices. (C) 1998 Elsevier Science B.V. All rights reserved.