Deflationary Pressures Today: The Chinese, Japanese and Spanish Cases Compared

22 Pages Posted: 16 Nov 2017

See all articles by Richard C. K. Burdekin

Richard C. K. Burdekin

Claremont McKenna College - Robert Day School of Economics and Finance

Xinyi Hu

Claremont Colleges, Claremont McKenna College, Robert Day School of Economics and Finance, Students

Date Written: November 13, 2017

Abstract

This paper considers the role of supply-side factors in the deflationary pressures seen in the aftermath of the global financial crisis. Although declines in consumer prices have been mild, much larger drops in producer prices occurred not only in China but also in Japan and Spain. Empirical examination of these three cases reveals a consistent impact of oil prices in contributing both to the deflationary pressures and the gap between consumer and producer prices. Not only did these downward pressures emerge in spite of record levels of monetary easing but also there is the risk of a fuller transmission from producer prices to consumer prices in the future.

Keywords: Deflation; Commodity Prices; Price Scissors; China; Japan; Spain

JEL Classification: E31

Suggested Citation

Burdekin, Richard C. K. and Hu, Xinyi, Deflationary Pressures Today: The Chinese, Japanese and Spanish Cases Compared (November 13, 2017). The Chinese Economy, Forthcoming ; Claremont McKenna College Robert Day School of Economics and Finance Research Paper No. 3070591. Available at SSRN: https://ssrn.com/abstract=3070591

Richard C. K. Burdekin (Contact Author)

Claremont McKenna College - Robert Day School of Economics and Finance ( email )

500 E. Ninth Street
Claremont, CA 91711
United States

Xinyi Hu

Claremont Colleges, Claremont McKenna College, Robert Day School of Economics and Finance, Students ( email )

500 E. Ninth St.
Claremont, CA 91711-6420
United States

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