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CROSS‐COUNTRY EVIDENCE ON LONG‐RUN GROWTH AND INFLATION
Author(s) -
CLARK TODD E.
Publication year - 1997
Publication title -
economic inquiry
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.823
H-Index - 72
eISSN - 1465-7295
pISSN - 0095-2583
DOI - 10.1111/j.1465-7295.1997.tb01895.x
Subject(s) - economics , inflation (cosmology) , econometrics , robustness (evolution) , regression , macroeconomics , monetary economics , statistics , mathematics , biology , biochemistry , physics , theoretical physics , gene
While inflation is generally inversely related to growth, I show that estimates of the relationship seer two robustness problems which plague a variety of model specifications. First, growth‐inflation results are highly sensitive to modifications to the country sample, limited from the start to low‐ and moderate‐inflation countries. Second, results are also sensitive to modifications in the time period of analysis. In conjunction with the regression specification sensitivity documented by Levine and Renelt [1992], these results should further discourage the practice cf quantifying inflation's effects with cross‐county growth regressions.