One Currency, One Price? Euro Changeover‐Related Inflation in Estonia

18 Pages Posted: 11 Jun 2015

See all articles by Jaanika Meriküll

Jaanika Meriküll

Bank of Estonia; University of Tartu

Tairi Rõõm

Bank of Estonia

Multiple version iconThere are 2 versions of this paper

Date Written: July 2015

Abstract

This article investigates euro changeover‐related inflation using disaggregated price‐level data. The differences‐in‐differences approach is used, and the control group for the treatment country, Estonia, is built from 12 eurozone countries. The Nielsen Company disaggregated price data are employed at product, brand and shop‐type levels. The results indicate that while the overall inflationary effect of euro adoption was modest, the effects were significantly different across various market segments. Changeover‐related inflation was higher for products that were relatively cheaper than the eurozone average. Inflationary effects were stronger in smaller shops.

Suggested Citation

Meriküll, Jaanika and Rõõm, Tairi, One Currency, One Price? Euro Changeover‐Related Inflation in Estonia (July 2015). JCMS: Journal of Common Market Studies, Vol. 53, Issue 4, pp. 822-839, 2015. Available at SSRN: https://ssrn.com/abstract=2617001 or http://dx.doi.org/10.1111/jcms.12228

Jaanika Meriküll (Contact Author)

Bank of Estonia ( email )

Estonia Building 13
15095 Tallinn
Estonia

University of Tartu ( email )

Ülikooli 18
Tartu 50090
Estonia

Tairi Rõõm

Bank of Estonia ( email )

Estonia Building 13
15095 Tallinn
Estonia

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