Rg. Edmonds et Jc. So, VARIABILITY AND INFLATION - EVIDENCE FROM DEVELOPED AND DEVELOPING-COUNTRIES, Journal of macroeconomics, 15(4), 1993, pp. 679-708
Variations of a reduced-form equation for inflation determination are
specified with ARCH processes for 34 countries. Results of testing for
and estimation of the ARCH specifications show significant results in
nearly half, but in five of those, tests suggest the presence of an A
R(4) process which may invalidate the test for ARCH. Use of predicted
conditional standard deviations of inflation, rather than the uncondit
ional measure used previously, shows no evidence of a correlation of v
ariability and inflation.