But, for the most part, the evidence seems to suggest that to date the effects have been gradual and limited: a greater role for the direct and indirect effects of import prices; possibly some damping of unit labor costs, though less so for prices from this channel judging from high profit margins; and potentially a smaller effect of the domestic output gap and a greater effect of foreign output gaps, but here too the evidence is far from conclusive.
In particular, the entry of China, India, and others into the global trading system probably has exerted a modest disinflationary force on prices in the United States in recent years. Moreover, we should recognize that these disinflationary effects could dissipate or even be reversed in coming years.