The focus of this analysis is on the output costs of disinflation. A model of inflation with both forward and backward elements seems to characterize reality. Such an inflation model is estimated using data for industrial countries, and the output costs of a disinflation path are calculated,...

This paper examines the possibility of nonlinear effects of inflation on economic growth. It finds evidence of a significant structural break in the function that relates economic growth to inflation. The break is estimated to occur when the inflation rate is 8 percent. Below that rate,...

Following price and exchange rate liberalization, domestic consumer prices in Russia moved closer to market levels. This paper quantifies the magnitude of the associated relative price changes. It also shows that relative price variability has been positively correlated with inflation. It is...

This paper argues that determining the cyclical behavior of prices by applying the same stationarity-inducing transformation to the levels of both output and prices, and examining the correlations of the resulting series, can be misleading. A more appropriate procedure is to examine the...

This paper analyzes the dominant factors influencing inflation in Nigeria. An error correction model of the inflation process is developed based on money market equilibrium conditions. The results of this analysis confirm the basic findings of earlier studies, namely, that monetary expansion,...

Yugoslav inflation unfolded as a classic wage-price-exchange rate spiral through the 1970s and 1980s, exploding into hyperinflation in the last quarter of 1989. Monetary accommodation of inflation, the behavior of demand for money, and the interaction between the two in Yugoslavia are examined....

While a standard academic presumption has been that wage indexation reduces the cost of disinflation, policymakers generally contend that wage indexing makes disinflation more difficult. To shed light on these views, this paper reexamines the effects of wage indexing on the output loss caused by...

The paper develops a model of inflationary finance that defines the fiscal deficit as a function of the virtual deficit--one that would be observed at zero inflation. It studies the negative relationship between the inflation rate and real government expenditures--the Patinkin effect--a powerful...

Previous tests for convexity in the Phillips curve have been biased because researchers have employed filtering techniques for the nonaccelerating inflation rate of unemployment (NAIRU) that have been fundamentally inconsistent with the existence of convexity. This paper places linear and...

Data for the G-7 countries strongly support the view that economic activity has a nonlinear effect on inflation, with high levels of activity raising inflation by more than low levels decrease it. In the face of such asymmetries, the average level of output in an economy subject to demand shocks...