Economics, Econometrics and Finance
4 years ago

Increased global competition fails to lower inflation rates, study finds.

Staff Reports
Globalization and Inflation Dynamics: The Impact of Increased Competition
Argia M. Sbordone

Paper Summary

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Global market competition may not have a significant impact on inflation dynamics, according to a study. The researchers used a model to show that an increase in the variety of traded goods might not lead to a big change in inflation rates. The findings suggest that more competition in the market may not necessarily lower prices as expected.