), the problem of instability is simply transferred to inflation rate differentials, what we call the (impossibility of the …) "uncovered inflation rate parity condition" in a monetary union. The analysis of the actual divergences and imbalances in the EMU …, then, suggests that failure to respect the "uncovered inflation rate parity condition" in a monetary union may lead to …

This paper examines the international convergence of inflation rates during the flexible rate period of eighteen OECD …