This paper examines the efficacy of food consumption subsidies as anti-inflation policy in developing countries characterized by rigidities of food supply. First a standard structuralist model is utilized to show that though a policy of food consumption subsidies brings down inflation in the...

This paper considers fiscal and monetary policy in a short-run static macroeconomic model. There are two objectives, control of inflation and control over the growth of national wealth, and a third outcome of importance, a high level of employment. There are two instruments, monetary policy (the...