An I(2) analysis of Australian inflation and the markup is undertaken within an imperfect competition model. It is found that the levels of prices and costs are best characterised as integrated of order 2 and that the levels cointegrate to the markup which is integrated of order 1. A further...

An I(2) analysis of inflation and the markup in undertaken for the G7 economies and Australia. We find that the levels of prices and costs are best described as I(2) processes and that except for Japan a linear combination of the log levels of process and costs cointegrate to the markup that is...

A fresh interpretaion is provided of the influential finding that the markup of prices over marginal costs is counter-cyclical. Using Rotemberg and Woodford's data set we argue that the markup is best modelled as a variable that is integrated of order one. A consequence of this finding is that...

An I(2) analysis of inflation and the markup is undertaken for the G7 economies and Australia. We find that the levels of prices and costs are best described as I(2) processes and that except for Japan a linear combination of the log levels or prices and costs cointegrate to the markup that is...

Using annual US data for gross domestic product originating by sector between 1947 and 1997 it is shown that a negative long-run relationship between inflation and the markup is present across the sectors as well as in the aggregate. A preliminary explanation based on indutry structure is...