RELATIVE-PRICE VARIABILITY IN THE UNITED-STATES - A DECOMPOSITION ANALYSIS

Following the Clements-Nguyen methodology, relative-price variability in the United States is decomposed into the components due to real factors, inflation, and their interaction. Overall, inflation accounts for about half of relative-price variability, but its share is the largest during 1973-1980 and the smallest during 1981-1986. Cross-commodity distribution of relative-price variability shows rather dramatic changes. © 1990.