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Inflation

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Full-Text Articles in Economics

Ua37/29 Gary Ransdell - Monetary Policy In A Low-Inflation Environment, St. Louis Federal Reserve Board Oct 2010

Ua37/29 Gary Ransdell - Monetary Policy In A Low-Inflation Environment, St. Louis Federal Reserve Board

Faculty/Staff Personal Papers

Email sent to members of the St. Louis Federal Reserve Board of Ben Bernanke's speech, Revisiting Monetary Policy in a Low-Inflation Environment delivered at the Federal Reserve Bank of Boston Conference in Boston, Massachusetts.


Forecasting Philippine Monthly Inflation Using Tramo/Seats, Cesar C. Rufino Jul 2010

Forecasting Philippine Monthly Inflation Using Tramo/Seats, Cesar C. Rufino

DLSU Business & Economics Review

The study aims to explore the feasibility of adopting for inflation forecasting a sophisticated expert system normally used in routine outlier detection and deseasonalization of time series. Known as TRAMO/SEATS expert system, this twin program is a fully automatic procedure that extracts the trend-cycle, seasonal, irregular and certain transitory components of high frequency time series via the so-called ARIMA-model-based method. The results of the study reveal the feasibility of the use of the technique for routine inflation forecasting. The automatic model building capability of TRAMO/SEATS is exploited to arrive at an ex-ante model that has the ability to generate optimal …


The Impact Of Inflation Targeting Regime On The Relationship Between Stock Returns And Inflation: International Evidence, Unro Lee Apr 2010

The Impact Of Inflation Targeting Regime On The Relationship Between Stock Returns And Inflation: International Evidence, Unro Lee

Eberhardt School of Business Faculty Articles

Twenty six industrialized and emerging countries have adopted inflation targeting monetary policy since 1990 to combat persistently high inflation rate. This policy accords either the government and/or the central bank the authority to assign an explicit numerical target for inflation rate and implement an appropriate monetary policy to achieve its goal. This study investigates whether the adoption of inflation targeting strategy has affected the relationship between stock returns and inflation rate. Specifically, this study tests a hypothesis that, in an economy where inflation targeting has been adopted as a new monetary policy strategy, real stock returns should be sensitive to …


Determinants Of Housing Prices In Pittsylvania County, Jason Hall Mar 2010

Determinants Of Housing Prices In Pittsylvania County, Jason Hall

Undergraduate Theses and Capstone Projects

The purpose of this research is to determine the implicit factors influencing housing prices in Pittsylvania County, a rural county in Southside Virginia. Currently in Pittsylvania County there is a debate over whether or not to mine what is believed to be the largest deposit of uranium in the United States, containing approximately 119 million pounds of uranium ore at an estimated value of $7 billion to $10 billion. The Virginia Coal and Energy Commission issued its final approval for the National Academy of Sciences to study the debate from a socio-economic standpoint. The $1.2 million study is currently taking …


Government’S Diminishing Benefits From Inflation, Jeffrey Rogers Hummel Jan 2010

Government’S Diminishing Benefits From Inflation, Jeffrey Rogers Hummel

Faculty Publications

No abstract provided.


Central Bank Independence: Rules, Practices, And Outcomes, Douglas Aaron Block Jan 2010

Central Bank Independence: Rules, Practices, And Outcomes, Douglas Aaron Block

Open Access Theses & Dissertations

In recent years interest has grown in central bank independence as research has shown that it may affect many important financial issues such as unemployment, inflation, and inflation variability, among others. However, empirical evidence regarding its effect has been inconclusive and there is low correlation among various legal central bank independence measures. In this thesis, I attempt to resolve these problems by generating a new measure of legal central bank independence that takes into account divergence between laws and practices. I then measure the impact that democracy and proportional electoral systems have on reducing this divergence and find that democracy …


Credit Cards And Inflation, John Geanakoplos, Pradeep Dubey Jul 2009

Credit Cards And Inflation, John Geanakoplos, Pradeep Dubey

Cowles Foundation Discussion Papers

The introduction and widespread use of credit cards increases trading efficiency but, by also increasing the velocity of money, it causes inflation, in the absence of monetary intervention. If the monetary authority attempts to restore pre-credit card price levels by reducing the money supply, it might have to sacrifice the efficiency gains. When there is default on credit cards, there is even more inflation, and less efficiency gains. The monetary authority might then have to accept less than pre-credit card efficiency in order to restore pre-credit card price levels, or else it will have to accept inflation if it is …


Inflationary Equilibrium In A Stochastic Economy With Independent Agents, John Geanakoplos, Ioannis Karatzas, Martin Shubik, William D. Sudderth Jun 2009

Inflationary Equilibrium In A Stochastic Economy With Independent Agents, John Geanakoplos, Ioannis Karatzas, Martin Shubik, William D. Sudderth

Cowles Foundation Discussion Papers

We argue that even when macroeconomic variables are constant, underlying microeconomic uncertainty and borrowing constraints generate inflation. We study stochastic economies with fiat money, a central bank, one nondurable commodity, countably many time periods, and a continuum of agents. The aggregate amount of the commodity remains constant, but the endowments of individual agents fluctuate “independently” in a random fashion from period to period. Agents hold money and, prior to bidding in the commodity market each period, can either borrow from or deposit in a central bank at a fixed rate of interest. If the interest rate is strictly positive, then …


The Economic Decline Of Zimbabwe, Chidochashe L. Munangagwa Jan 2009

The Economic Decline Of Zimbabwe, Chidochashe L. Munangagwa

Gettysburg Economic Review

For the past decade, Zimbabwe has been experiencing an economic decline that has resulted in an inflation rate of 231 million percent and an unemployment rate of over 90 percent. Past research has concluded that the economic decline of Zimbabwe has mainly been caused by poor monetary policies and failure of fiscal policies to control the budget deficit. This research aimed to closely examine some of these policies that the Zimbabwean government implemented, the effects of these policies on economic activity, employment and inflation levels in the country. By interviewing many economic analysts in Zimbabwe, I managed to gather the …


Exchange Rate Pass-Through For Selected Southeast Asian Countries, Stephanie L. Chan Jan 2009

Exchange Rate Pass-Through For Selected Southeast Asian Countries, Stephanie L. Chan

DLSU Business & Economics Review

Long- and short-run exchange rate pass-through coefficients were estimated for Malaysia, Indonesia, Thailand, and the Philippines using a simple model based on absolute purchasing power parity. Results were lower than 0.30 for all four countries. Cointegration tests confirmed the existence of a long-run relationship between CPI, GDP, exchange rate, and the U.S. PPI for the countries studied. However, the post-estimation tests showed that a more comprehensive model may need to be developed. The low coefficients reflect the success of the countries in stabilizing their inflation levels, though implying that exchange rate interventions may be less effective in restoring trade balance.


Is Nigeria Ready For Inflation Targeting, Mbutor O. Mbutor Sep 2008

Is Nigeria Ready For Inflation Targeting, Mbutor O. Mbutor

Bullion

Inflation Targeting as a framework for monetary policy implementation simply describes a policy framework in which central banks accept and announce the realization of certain forecast targets of inflation, over a given time period, as the measure policy anchor and are accountable for deviations from actual inflation from the said target. The primary goal of the paper was to expose the prospects and challenges facing the implementation of inflation targeting in Nigeria. To put the subject in proper perspective, common terminologies often used in discussing lT were defined. The preconditions for effective lT were also highlighted. The paper has argued …


Optimal Rules Bagi Instrumen Kebijakan Moneter Di Indonesia: Pengujian Empiris Model Guender, Zenathan Adnin, Eugenia Mardanugraha Jul 2008

Optimal Rules Bagi Instrumen Kebijakan Moneter Di Indonesia: Pengujian Empiris Model Guender, Zenathan Adnin, Eugenia Mardanugraha

Jurnal Ekonomi dan Pembangunan Indonesia

This study aims to test model developed by Guender (2002) in determining optimal rules for monetary policy instrument in Indonesia. The test is conducted by estimating parameters of IS equation and Forward Looking Phillips Curve. The result expected is rules for determining the optimal interest rate which is influenced by the gap between actual and targeted inflation. The result shows that in the era of inflation targeting the interest rate setting policy as monetary policy instrument has focus on output stability rather than inflation stability. Finally, the study concludes that the interest rate targeting as BI rate has not being …


The Year In Review: 2007 Marks Start Of Slowdown, Alan Clayton-Matthews Jan 2008

The Year In Review: 2007 Marks Start Of Slowdown, Alan Clayton-Matthews

Public Policy and Public Affairs Faculty Publication Series

The state’s economy slowed moderately in 2007, the beginning of a slowdown that may last several years. The deceleration was precipitated by a downturn in the housing market that, in Massachusetts, began in late 2005, and gained downward momentum in 2006. Last summer, fi nancial havoc from sub-prime mortgage defaults and falling prices throughout most of the nation tipped the nation’s economy to the brink of recession. This year, soaring energy prices threaten to weigh down the economy further, neutralizing the fi scal stimulus package that is coming on line now.


2007-3 Financial Stability, Monetarism And The Wicksell Connection, David Laidler Jan 2007

2007-3 Financial Stability, Monetarism And The Wicksell Connection, David Laidler

Economic Policy Research Institute. EPRI Working Papers

No abstract provided.


2007-2 Successes And Failures Of Monetary Policy Since The 1950s, David Laidler Jan 2007

2007-2 Successes And Failures Of Monetary Policy Since The 1950s, David Laidler

Economic Policy Research Institute. EPRI Working Papers

No abstract provided.


Death And Taxes, Including Inflation: The Public Versus Economists, Jeffrey Rogers Hummel Jan 2007

Death And Taxes, Including Inflation: The Public Versus Economists, Jeffrey Rogers Hummel

Faculty Publications

Inflation worries the general public much more than it does the economics profession, and economists remain perplexed as to exactly why. The costs that concern economists are inflation’s deadweight loss. But that is only a part of the losses that concern the public, because inflation simultaneously transfers some of people’s income into the hands of government. The fact that the seigniorage tax may pay for programs they favor is a separate issue. Moreover, unlike income and other taxes, which people in democratic countries may think they have some control over through voting, seigniorage appears utterly arbitrary. In fact, people can …


The Class Content Of Preferences Towards Anti-Inflation And Anti Unemployment Policies, Arjun Jayadev Jan 2007

The Class Content Of Preferences Towards Anti-Inflation And Anti Unemployment Policies, Arjun Jayadev

Economics Faculty Publication Series

This paper assesses class based preferences towards anti-inflationary and anti-unemployment policy. Using a consistent cross-country social survey, I find that the working class broadly defined, and those with lower occupational skill and status are more likely to prioritize combating unemployment rather than inflation. The result is robust to the inclusion of several plausible controls. The idea that the working class is less ‘relatively inflation averse’ is consistent with earlier predictions coming from large body of political economy research in the 1970s. The finding that inflation and unemployment aversion have a distinct class character has implications for current debates on the …


Openness, The Sacrifice Ratio, And Inflation: Is There A Puzzle?, Joseph P. Daniels, David D. Vanhoose Dec 2006

Openness, The Sacrifice Ratio, And Inflation: Is There A Puzzle?, Joseph P. Daniels, David D. Vanhoose

Economics Faculty Research and Publications

The standard time-inconsistency-based explanation for the negative correlation between openness and inflation requires an inverse relationship between the sacrifice ratio and openness, but Daniels et al. (2005, Openness, central bank independence, and the sacrifice ratio. Journal of Money, Credit, and Banking 37 (2), 371–379.) have provided evidence that controlling for central bank independence reveals a positive relationship. This paper embeds the time-inconsistency approach within a model of a multisector, imperfectly competitive, open economy. In this setting, greater openness raises the sacrifice ratio but reduces the inflation bias. Thus, failure to observe an inverse relationship between openness and the sacrifice ratio …


Openness, Centralized Wage Bargaining, And Inflation, Joseph P. Daniels, Farrokh Nourzad, David D. Vanhoose Dec 2006

Openness, Centralized Wage Bargaining, And Inflation, Joseph P. Daniels, Farrokh Nourzad, David D. Vanhoose

Economics Faculty Research and Publications

This paper develops a model of an open economy containing both sectors in which wages are market-determined and sectors with wage-setting arrangements. A portion of the latter group of sectors coordinate their wages, taking into account that their collective actions influence the equilibrium inflation outcome in an environment in which the central bank engages in discretionary monetary policymaking. Key predictions forthcoming from this model are (1) increased centralization of wage setting initially causes inflation to increase at low degrees of wage centralization but then, as wage centralization increases, results in an inflation drop-off; (2) a greater degree of centralized wage …


Openness, Income-Tax Progressivity, And Inflation, Joseph P. Daniels, David D. Vanhoose Dec 2006

Openness, Income-Tax Progressivity, And Inflation, Joseph P. Daniels, David D. Vanhoose

Economics Faculty Research and Publications

This paper considers a model of an open economy in which the degree of income-tax progressivity influences the interaction among openness, central bank independence, and the inflation rate. Our model suggests that an increase in the progressivity of the tax system induces a smaller response in real output to a change in the price level. This implies that increased income-tax progressivity reduces the equilibrium inflation rate and that the effect of increased income-tax progressivity on inflation is smaller when the central bank places a higher weight on inflation or when there is greater openness. Examination of cross-country inflation data provides …


Dampak Pembiayaan Defisit Anggaran Dengan Utang Luar Negeri Terhadap Inflasi Dan Pertumbuhan Ekonomi: Studi Kasus Indonesia Tahun 1970-2003, Joko Waluyo Jul 2006

Dampak Pembiayaan Defisit Anggaran Dengan Utang Luar Negeri Terhadap Inflasi Dan Pertumbuhan Ekonomi: Studi Kasus Indonesia Tahun 1970-2003, Joko Waluyo

Jurnal Ekonomi dan Pembangunan Indonesia

The main purpose of this study is to find the effect of budget deficit with foreign loans as source of funding on inflation and economic growth. This study focuses on transmission mechanism of budget deficit funding effects on inflation and economic growth. We use a specific simultaneous macroeconomic model which includes 17 behavioral equations and 18 identity equations with 6 blocks in this study, Two Stage least Square (TSLS) method is employed to estimate the behavioral equations in the model. This study use Indonesia secondary economic data from 1970 to 2003. Econometric tests are performed to produce BLUE estimator. This …


2006-3 Axel Leijonhufvud And The Quest For Micro-Foundations -- Some Reflections, David Laidler Jan 2006

2006-3 Axel Leijonhufvud And The Quest For Micro-Foundations -- Some Reflections, David Laidler

Economic Policy Research Institute. EPRI Working Papers

No abstract provided.


Vanity And The Daedalian Wings Of Paper Money In Adam Smith, Maria Pia Paganelli Jan 2006

Vanity And The Daedalian Wings Of Paper Money In Adam Smith, Maria Pia Paganelli

Economics Faculty Research

Adam Smith presents a detailed technical analysis of both private and public credit. Many contemporaries, including David Hume, recognized that public credit, and in part private credit, could be used to affect the economy, either for good or bad. Nevertheless, Smith does not seem to recognize the full potential of public credit as a policy instrument whether as a way to stimulate the economy, fine-tune it, or cause economic disasters. The reason for this shortcoming may be Smith's downplaying the desire for power and benevolence as motivational forces in human conduct, due to his emphasis on vanity instead.


Real Interest Rates And Inflation In Norway, David E. Allen, Tinashe Mapfumba Jan 2006

Real Interest Rates And Inflation In Norway, David E. Allen, Tinashe Mapfumba

Research outputs pre 2011

We analyse the effectiveness of the monetary stance adopted by the Norwegian central bank in implementing monetary policy assessing how it relates to the neutral rate of interest. The neutral rate is frequently defined as the level of real interest rate consistent with both stable inflation and a level of production equal to potential production; providing no stimulus or restraint to the economy. We attempt to calculate this rate and to examine the long run link between real interest rates and inflation in Norway. We apply cointegration analysis to explore whether the gap between the real and neutral rate of …


Purchasing Power Parity And Exchange Rate In Nigeria: A Regime Switching Approach., M. C. Ononugbo Jun 2005

Purchasing Power Parity And Exchange Rate In Nigeria: A Regime Switching Approach., M. C. Ononugbo

Economic and Financial Review

This study basically extends the work of Obaseki (1998) by including an additional variable to capture the impact of changes in exchange rate regime. The paper undertakes an empirical examination of the long-run co-movement in naira exchange rate and relative price levels of Nigeria and USA. The impact of the policy swap from a system of exchange rate control to a market based system (captured by a dummy variable) is investigated using an error correction model. The outcome reveals the applicability of the PPP using Nigerian data. From the analysis, the prevailing nominal exchange rate during the period closely approximates …


2005-08 Monetary Policy And Its Theoretical Foundations, David Laidler Jan 2005

2005-08 Monetary Policy And Its Theoretical Foundations, David Laidler

Economic Policy Research Institute. EPRI Working Papers

No abstract provided.


2005-11 Milton Friedman And The Evolution Of Macroeconomics, David Laidler Jan 2005

2005-11 Milton Friedman And The Evolution Of Macroeconomics, David Laidler

Economic Policy Research Institute. EPRI Working Papers

No abstract provided.


Household Reaction To Changes In Housing Wealth, Robert J. Shiller Apr 2004

Household Reaction To Changes In Housing Wealth, Robert J. Shiller

Cowles Foundation Discussion Papers

It is widely claimed that housing wealth, as well as stock prices, have an impact on consumption and hence on aggregate economic activity. This paper presents a broad overview of the issues that arise in evaluating this claim in the context of recent research in behavioral economics. Particular attention is paid to a model of the response of consumption to wealth components produced by Christopher Carroll [2004].


2004-5 Woodford And Wicksell On Interest And Prices: The Place Of The Pure Credit Economy In The Theory Of Monetary Policy, David Laidler Jan 2004

2004-5 Woodford And Wicksell On Interest And Prices: The Place Of The Pure Credit Economy In The Theory Of Monetary Policy, David Laidler

Economic Policy Research Institute. EPRI Working Papers

No abstract provided.


The Relevance Of Inflation And Exchange Rate Risk For Monetary Convergence To The Eurozone, Lucjan Orlowski Jul 2003

The Relevance Of Inflation And Exchange Rate Risk For Monetary Convergence To The Eurozone, Lucjan Orlowski

WCBT Faculty Publications

This study places a strong emphasis on the ability of Central European Countries to lower inflation and exchange rate risk premiums on their path of monetary convergence to the eurozone. A model of the nexus between both risk premiums is presented along with the recent evidence supporting well-coordinated interactions between these risk premiums for Poland, Hungary and the Czech Republic. The analysis implies that monetary policies based on direct inflation targeting are likely to contain these risk premiums in the candidate countries and can be effectively used during the remaining period of their preparations for entering the euro area.