02033cas a2200253 a 4500 AALejournalIMF001661 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451854725 1018-5941 BD-DhAAL BD-DhAAL Holub, Tomas. Convergence of Relative Prices and Inflation in Central and Eastern Europe / Tomas Holub, Martin Cihak. Washington, D.C. : International Monetary Fund, 2001. 1 online resource (48 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students The paper assesses inflation risks resulting from the convergence of structures of relative prices in Central and Eastern European (CEE) countries toward the European Union (EU). The basic idea of the paper is that under low downward flexibility of domestic nominal prices, the adjustment of relative price structures is likely to lead to higher inflation. The authors find that the degree of differences in the structures of relative prices in transition economies vis-a-vis EU economies has a strong negative relationship to price levels in the transition economies. Based on their calculations, the authors assess the likely future inflationary pressures that can stem from the remaining differences between the structures of relative prices in the CEE economies and the EU. The authors argue that their approach can be thought of as an extension of the standard Balassa-Samuelson explanation of international variability in price levels. Mode of access: Internet Cihak, Martin. IMF Working Papers; Working Paper ; No. 2001/124 Full text available on IMF http://elibrary.imf.org/view/journals/001/2001/124/001.2001.issue-124-en.xml IMF e-Library