scholarly journals Is Inflation Fiscally Determined?

2021 ◽  
Vol 13 (20) ◽  
pp. 11306
Author(s):  
Lamia Bazzaoui ◽  
Jun Nagayasu
Keyword(s):  
Monetary Policy ◽  
Fiscal Policy ◽  
Latin American ◽  
Inflation Targeting ◽  
Panel Var ◽  
Budget Deficits ◽  
Policy Frameworks ◽  
Fiscal Space ◽  
The Difference ◽  
The Relationship

This paper examines the relationship between fiscal policy and inflation for 44 countries, from 1960 to 2020. The study was conducted using a panel VAR approach while accounting for the difference in monetary policy frameworks and the levels of fiscal space across countries. Results suggest that budget deficits are less likely to cause inflation when monetary policy is based on inflation targeting. In contrast, they are inflationary in the group of countries with a poorly structured monetary policy (such as partially dollarized Latin American economies).

Regional effects of inflation targeting in Russia: Factors of heterogeneity and structural inflation rates

2019 ◽  
pp. 70-89
Author(s):  
Michael I. Zhemkov
Keyword(s):  
Monetary Policy ◽  
Inflation Targeting ◽  
Structural Factors ◽  
Regional Effects ◽  
Inflation Rates ◽  
Price Growth ◽  
Effective Exchange ◽  
The Difference ◽  
Communication Policies ◽  
Structural Levels

Inflation targeting in Russia implies maintaining stable low inflation at a level of 4% throughout the country. The presence of structural factors in some regions can determine deviations from the all-Russian inflation, which can lead to different effects of monetary policy in Russian regions. In this paper, we analyze regional heterogeneity of inflation and factors of inflation deviations from the national average, estimate structural levels of inflation in the regions of Russian Federation. These estimates confirm the presence of some regional factors of inflation deviations from the all-Russian indicator, such as the difference in productivity growth of the tradable and non-tradable sectors (Balassa—Samuelson effect), effective exchange rates, real incomes and product stocks. In addition, our results confirm the presence of regions with price growth rate above and below monetary policy target. The results of this research can be used for the development of monetary and communication policies.

scholarly journals Concentration of Banking Sector and Loan Markups in Short Term: An Example from Poland

2014 ◽  
Vol 5 (2) ◽  
pp. 26-44
Author(s):  
Krysztof Drachal
Keyword(s):  
Monetary Policy ◽  
Banking Sector ◽  
Mortgage Market ◽  
Future Research ◽  
Simple Linear Regression ◽  
Short Term ◽  
Monthly Data ◽  
Regression Techniques ◽  
The Difference ◽  
The Relationship

The aim of this paper is to present an analysis of the relationship between concentration of the banking sector and banks' markups on offered loans. The markup is understood as the difference between the rate offered by banks and the reference rate fixed by the Monetary Policy Council. The period between 2009 and 2013 was analyzed. Monthly data from the Polish banking sector were considered. This paper also consists of the literature review, which focuses on the mortgage market. The methodology used for the analysis is based mainly on simple linear regression techniques. It is found that such methods are not sufficient to give conclusive answers. Therefore additional future research is proposed.

scholarly journals Contractionary depreciations in Latin America during the 2000s

2021 ◽  
Vol 41 (4) ◽  
pp. 723-744
Author(s):  
MARTÍN MONTANÉ ◽  
EMILIANO LIBMAN ◽  
GUIDO ZACK
Keyword(s):  
Monetary Policy ◽  
Latin America ◽  
Simple Model ◽  
Latin American ◽  
Inflation Targeting ◽  
Taylor Rule ◽  
Policy Implications ◽  
Var Models ◽  
Short Run ◽  
Latin American Countries

ABSTRACT This paper explores the effects of currency depreciations on output for the main Latin American countries that have been using Inflation Targeting for almost two decades. We construct VAR models for Brazil, Chile, Colombia, Mexico and Peru for the last two decades and we find that depreciations have short-run contractionary effects in Brazil and Mexico. We illustrate some of the policy implications of that finding by building a simple model, and we show that contractionary effects of depreciations may have destabilizing effects when monetary policy is conducted using a standard Taylor Rule.

scholarly journals The Relationship Between External Debt, Economic Growth, Unemployment and National Expenditure in Viet Nam

2018 ◽  
Vol 1 (2) ◽  
pp. p129
Author(s):  
Anh Tru Nguyen
Keyword(s):  
Economic Growth ◽  
Monetary Policy ◽  
Fiscal Policy ◽  
External Debt ◽  
Viet Nam ◽  
Credit Growth ◽  
Short Run ◽  
The Government ◽  
The Relationship ◽  
Macroeconomic Stability

The article examines the relationship between external debt, economic growth, unemployment and national expenditure in Viet Nam between 1987 and 2016. We found that the influence of a variable on other variables varies in the short run. We found that there are directional relationships between GDP and external debt and GDP and national expenditure. We also found that there are directional relationships between unemployment and external debt, GDP, and national expenditure. Results addressed directional relationships between national expenditure and external debt and GDP. There are two co-integrations among variables. In order to sustain macroeconomic stability in Viet Nam, fiscal policy should be re-examined to meet large development needs and monetary policy should be tightened to reduce credit growth. Specifically, external debt should be effectively managed by the government because an increase in external debt leads to a decrease in GDP and a growth of unemployment. Moreover, GDP should be facilitated to reduce unemployment in the economy. Lastly, unemployment needs to be controlled because it generates a boom of national expenditure and vice versa.

scholarly journals Monetary Policy Rules in Emerging ASEAN Economies

2021 ◽  
Vol 12 (3) ◽  
pp. 255-274
Author(s):  
Mesa Wanasilp
Keyword(s):  
Monetary Policy ◽  
Method Of Moments ◽  
Inflation Targeting ◽  
Generalized Method Of Moments ◽  
The Philippines ◽  
Policy Implications ◽  
Output Gap ◽  
Policy Rules ◽  
Monetary Policy Rules ◽  
The Difference

This paper examines the monetary policy rules for five emerging ASEAN economies—Indonesia, the Philippines, and Thailand as the adopters of inflation targeting (IT) and Malaysia and Vietnam as the non-IT adopters. For the methodology, this study applies a generalized method of moments that provides a consistent and efficient estimator for the estimation that contains endogenously determined variables. The questions are whether the rules of the IT adopters have fulfilled the Taylor principle and what has been the difference in the rules between the IT adopters and the non-IT adopters. The main findings are as follows: Regarding the IT adopters, their rules are characterized by inflation-responsive rules fulfilling the Taylor principle. As for the non-IT adopters, Malaysia follows solely an output-gap responsive rule, and Vietnam exhibits the mixed rules. The policy implications are that for the IT adopters there might be room to make their policy-rate responses more elastic to inflation, and that for the non-IT adopters, there would be a need to adopt an explicit IT framework.

Empirical appraisal of fiscal stability: the case of Ghana

2015 ◽  
Vol 42 (5) ◽  
pp. 753-779
Author(s):  
Nana Kwame Akosah
Keyword(s):  
Economic Growth ◽  
Monetary Policy ◽  
Fiscal Policy ◽  
Central Bank ◽  
Public Debt ◽  
Inflation Targeting ◽  
Fiscal Sustainability ◽  
Content Type ◽  
Quarterly Data ◽  
Poor Countries

Purpose – The purpose of this paper is to appraise the stability of Ghana’s fiscal policy by assessing government’s reaction in the past to rising public debt over the last three decades. Design/methodology/approach – Using quarterly data spanning 1990Q1-2013Q2, the study evaluated the mean reverting properties of Ghana’s public debt and also estimate the fiscal policy reaction function. The complementary estimation techniques include Pesaran et al. (2001) bound testing cointegration test, differencing method and also Granger two-step cointegration methods. Findings – Using quarterly data from 1990Q1 to 2013Q2, the study found the fiscal policy to be unstable in the 1990s, necessitating the adoption of Heavily Indebted Poor Countries’ initiative in 2001. The fiscal situation however relatively stabilizes afterwards following the external debt relief in 2001. Nevertheless, the study reveals that the recent fiscal policy (since 2006) seems to be confronted with tremendous fiscal pressures, exacerbated by fiscal excesses during election cycles as well as excessive domestic and external borrowings. In addition, the economic growth-debt link was found to be weak, though debt appears to adversely affect economic growth. Research limitations/implications – The study does not thoroughly explore the possibility of non-linear relationship between public debt and primary balance. Also, the result could be different using different data frequencies. Practical implications – The state of government finance has implications on the monetary policy and economic growth prospects of an economy. As an inflation targeting central bank since 2002, a successful monetary policy implementation that reins in inflation requires fiscal policy that curtails fiscal volatilities originating from imprudent behaviour of government. Therefore, the looming fiscal pressures in recent times would impair the effective implementation of the inflation targeting framework by the central bank, and also retard economic growth as the bulk of these expenditures are usually recurrent in the case of Ghana. Originality/value – This is the first paper to employ complementary econometric techniques to empirically evaluate fiscal sustainability in Ghana.

scholarly journals Inflation Targeting Experience: Lessons for Ukraine

2015 ◽  
pp. 39-53 ◽  
Author(s):  
David Vavra
Keyword(s):  
Monetary Policy ◽  
Exchange Rate ◽  
Inflation Targeting ◽  
Initial Conditions ◽  
Emerging Market ◽  
Policy Transmission ◽  
Policy Frameworks ◽  
Fiscal Dominance ◽  
General Lesson ◽  
New Framework

In the past three decades, many advanced market and emerging market economies have modernized their monetary policy frameworks. We research the experience of these economies for lessons relevant to the monetary policy in Ukraine, which has recently embarked on a similar modernization program. Most countries we study have adopted some form of inflation targeting, given unfavorable experiences with previous regimes based on money and exchange rate, however with the exchange rate continuing to play an important role. Most of the pillars of effective IT monetary policy developed over time through determined efforts led by central banks, and the initial conditions did not matter for success. Countries have experienced numerous challenges with regards to communication, credibility, policy transmission, and fiscal dominance. Overcoming these challenges gave rise to new practices, which now form the stateof- the art monetary policy, irrespective of whether it is called an IT regime. A general lesson for Ukraine (as well as other future modernizers and IT adopters) is that determination and speed in building the pillars of IT policy is paramount for success and credibility of the new framework.

scholarly journals SECURITY AND PEACE IN LATIN AMERICAN COUNTRIES

2017 ◽  
Vol 8 (3) ◽  
pp. 129
Author(s):  
Paulo Gustavo Da Silva ◽  
Arnoldo Jose De Hoyos Guevara ◽  
Nilson Gonçalves Pereira Baptista ◽  
Lilian Cordeiro Praes
Keyword(s):  
Latin America ◽  
Latin American ◽  
The Road ◽  
Two Factors ◽  
Historical Relationship ◽  
The Difference ◽  
Historical Trajectory ◽  
Relationship Of ◽  
The Relationship ◽  
Latin American Countries

This work aims to analyze the relationship between security and peace and their present conditions in Latin America, based on the research of these issues in international publications in various media and data collection indicators available in studies with statistical reliability. There is also the goal of obtaining a set of indicators in the light of existing jobs and new contributions that may show the “state” of present Security and Peace conditions in Latin America and infer about the future of such conditions, with a view to proposing actions between and within countries of the region. The Security-Peace binomial presents us with a fundamental question regarding the relationship of cause and effect - the safety results from the peace or peace is a consequence of security? Independent-minded succeed or not answer this question we have to consider that the two factors have impacts on the wellness of the human being. Equal opportunities and valuing life are fundamental principles that pave the road to full citizenship in Latin America, and without which it won´t make sense any attempt to try to achieve security and peace. The Security Commission Hemispheric of the Organization of American States Permanent Council emphasizes in a recent meeting (March 2000) that among the premises for reformulation of the hemisphere’s security concept are “the need to recognize the close links between security, development and consolidation of democracy as well as the historical relationship between peace and democracy”. We are hence at a very special moment of our historical trajectory, where notorious disrespect for human rights are a frequent threat to populations of Latin American countries. Initiatives to education, focusing on children and youth, with heavy use of art and science, may make all the difference and create today a future of peace and security, based on fraternity among all peoples.

Sign in / Sign up

Export Citation Format

Share Document