Price Dynamics in China

 
Author/Editor: Porter, Nathaniel John
 
Publication Date: September 01, 2010
 
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Disclaimer: This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate
 
Summary: Chinese inflation, particularly non-food inflation, has been surprisingly modest in recent years. We find that supply factors, including those captured through upstream foreign commodity and producer prices, have been important drivers of non-food inflation, as has foreign demand for Chinese goods. Domestic demand and monetary conditions seem less important, possibly reflecting a large domestic output gap generated by many years of high investment. Inflation varies systemically within China, with richer (and urban) provinces having lower, more stable, inflation, but this urban inflation also influence that in lower-income provinces. Higher Mainland food inflation also raises inflation in non-Mainland China.
 
Series: Working Paper No. 10/221
Subject(s): China, People's Republic of | Economic models | Inflation | Prices | Spillovers

Author's Keyword(s): China | inflation | inflation spillovers | provincial inflation
 
English
Publication Date: September 01, 2010
Format: Paper
Stock No: WPIEA2010221 Pages: 26
Price:
US$18.00 (Academic Rate:
US$18.00 )
 
 
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