International Trade Openness and Inflation in Asia

Abstract

This article examines whether international trade openness is related with inflation or not in Asian countries. The relationship in the world has been discussed including economic growth for a long time from both theoretical and empirical ones, however, there has not been any consensus about this problem. It is necessary to analyze this relationship to achieve sound economic growth. Panel data in Asia and OECD countries are used to examine the relationship between international trade openness and inflation empirically in both areas. The results show that the relationship exists both in Asia and in OECD countries, however, it exists strongly in Asian recent period.