Price Pressure Gaps : An Application of P* Using Korean Data

Author/Editor:

Richard D Haas ; Robert J. Corker

Publication Date:

March 1, 1991

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:

This paper presents estimates of a price-pressure indicator for Korea. It does this by constructing measures of how much M2 velocity and output differ from their long-term values. This, in turn, involves estimating a demand for money function in an error correction framework in which interest rates in the unorganized money market help to account for the effects of ongoing financial liberalization. An equation explaining the Korean inflation rate is identified in which both the monetary variable--the velocity gap--and the real variable--the output gap--play important roles.

Series:

Working Paper No. 91/26

Subject(s):

English

Publication Date:

March 1, 1991

ISBN/ISSN:

9781451981728/1018-5941

Stock No:

WPIEA0261991

Price:

$15.00 (Academic Rate:$15.00)

Format:

Paper

Pages:

26

Please address any questions about this title to publications@imf.org