Discussion paper

DP15914 International Co-movements of Inflation, 1851-1913

We study co-movements of inflation in a group of 15 countries before and during the classical Gold Standard by fitting a generalisation of the Ciccarelli-Mojon (2010) model on annual data spanning 1851-1913. We find that international inflation functions as an “attractor” for domestic inflation rates. The cross-sectional dispersion of inflation declined gradually over the sample and Bai-Perron tests for structural breaks at unknown points in time suggest that there are breaks in six of reduced-form inflation equations. However, sub-sample estimates indicate that the overall finding that international inflation is an important influence on domestic inflation.


Gerlach, S and R Stuart (2021), ‘DP15914 International Co-movements of Inflation, 1851-1913‘, CEPR Discussion Paper No. 15914. CEPR Press, Paris & London. https://cepr.org/publications/dp15914