Nault, Barrie RDexter, Albert S.Levi, Maurice D.2016-01-042016-01-042005-09Dexter, A.S., M. D. Levi and Nault, B.R., "International Trade and the Connection Between Excess Demand and Inflation", Review of International Economics, 13, 4 (September 2005), 699-708.0965-7576http://hdl.handle.net/1880/51035author can archive pre-print (ie pre-refereeing). Publisher source must be acknowledged with citation. http://ezproxy.lib.ucalgary.ca/login?url=http://search.ebscohost.com/login.aspx?direct=true&db=bsh&AN=18257882&site=ehost-live Must link to publisher version with set statement (see policy)This paper demonstrates that globalization, taking the form of a higher import component of consumption and a larger export component of GDP, is the cause of the apparent breakdown in the relationship between excess demand and inflation. Within a parsimonious empirical framework, we show that increasing openness of the US economy is all that is needed to re-establish the relationship between inflation and capacity utilization. We also show that international trade has a significant separate influence on inflation, and is important for identifying a Phillips curve relationship between unemployment and inflation.enGlobalizationInternational tradeConsumption (Economics)Demand (economic theory)Supply & DemandInflation (Finance)journal article10.1111/j.1467-9396.2005.00532.x10.11575/PRISM/34188