Measuring inflation expectations in interwar Britain
Lennard, J.
, Meinecke, F. & Solomou, S.
(2022).
Measuring inflation expectations in interwar Britain.
Economic History Review,
https://doi.org/10.1111/ehr.13215
, Meinecke, F. & Solomou, S.
(2022).
Measuring inflation expectations in interwar Britain.
Economic History Review,
https://doi.org/10.1111/ehr.13215
What caused the recovery from the British Great Depression? A leading explanation – the ‘expectations channel’– suggests that a shift in expected inflation lowered realinterest rates and stimulated consumption and invest-ment. However, few studies have measured, or tested theeconomic consequences of, inflation expectations. In thispaper,wecollecthigh-frequencyinformationfromprimaryand secondary sources to measure expected inflation inthe United Kingdom between the wars. A high-frequencyvector autoregression suggests that inflation expectationswere an important source of the early stages of economicrecovery in interwar Britain.
Explore Further
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lennard, J.
(2022).
Data and Code for: Measuring Inflation Expectations in Interwar Britain.
[Dataset]. OpenICPSR.
https://doi.org/10.3886/e179361
