Globalization and changing inflation dynamics in China

• Autores: Chengsi Zhang, Huihong He
• Localización: Emerging Markets Finance & Trade, ISSN-e 1558-0938, Vol. 52, Nº. 3, 2016, págs. 625-638
• Idioma: inglés
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• Resumen

  • This article investigates the changing impact of economic globalization on inflation in China over the post-reform era. We construct an inflation dynamics model with globalization factors from microeconomic foundations. Empirical results with quarterly data spanning from 1984 to 2012 show that in 1994 there was a significant structural change in the inflation dynamics model, after which China’s inflation responded more significantly to foreign economic slack while the slope of the inflation-domestic slack relation reduced substantively