The Determinants of Inflation in Post-War Britain: An Empirical Study
24 Pages Posted: 8 Oct 2006
Date Written: December 2005
The aim of this paper is to arrive with a valid model that represents the determinants of inflation in Britain. Hence, the period from 1970 to 2003 is taken in consideration. Multiple regression analysis is used to test the hypotheses, which evokes an econometric model. Further, the significance of the included variables is tested and their economic sense is discussed. Finally, diagnostic tests performed, add towards constructing valid and representative model. As a result, convergence between the results from the empirical estimation and theory is found.
Keywords: Inflation, post-war, Britain, determinants
JEL Classification: E31, P24, P44
Suggested Citation: Suggested Citation