KIM Sangho
   Department   Ritsumeikan Asia Pacific University  College of Asia Pacific Studies
   Position   Professor
Language English
Publication Date 2013/04
Type Research paper (Academic/Professional Journal)
Peer Review Peer reviewed
Title Does productivity growth lower inflation in Korea?
Contribution Type First author
Journal Applied Economics
Volume, Issue, Page 45(16),pp.2183-2190
Author and coauthor Hyunjoon Lim and Donghyun Park
Details We investigate Granger causality between productivity growth and inflation in Korea
using quarterly data for the period 1985Q1–2002Q4. Our results indicate unidirectional
Granger causality from productivity growth to inflation. In light of such causality, we
estimate the effect of productivity and other variables on productivity. According to our
regression results, a 1% increase in labour and Total Factor Productivity (TFP) reduces
Consumer Price Index (CPI) inflation by 0.07–0.08% and 0.37–0.44%, respectively. Our
results also suggest that the productivity-inflation nexus became stronger in Korea since
the Asian financial crisis, and that this was largely due to structural reform and
technological progress.
Note: SSCI
DOI 10.1080/00036846.2012.657352
ISSN 0003-6846