Inflation Bias after the Euro: Evidence from the UK and Italy
Piergallini AlessandroMarini GiancarloScaramozzino Pasquale
CEIS Research Paper
This paper presents an indirect approach to investigate the possible existence of measurement error bias in the Harmonized Index of Consumer Prices for the UK and Italy. Our empirical results show that there is no significant evidence for a bias in the UK, nor for Italy prior to the introduction of the Euro. Since January 2002, however, the inflation rate in Italy has been underestimated by at least 6 percentage points.
Number: 60
Keywords: Inflation, Measurement bias
JEL codes: C22, C43, D14, E31
Date: Thursday, October 14, 2004
Revision Date: Thursday, October 14, 2004