Arbeitspapier

Disinflations in Latin America and the Caribbean: A free lunch?

This paper challenges the conventional view according to which disinflations in LAC-even from low and moderate peaks-have been carried out at no cost to output. After suggesting a new methodology that allows for long-lived effects and inflation inertia when measuring costs of disinflations, large sacrifice ratios are obtained for the 1970s and 80s. Nevertheless, a new puzzle arises: disinflation costs in the 90s are negative, even with the new methodology. It is shown that an unusual combination of circumstances-i.e. capital inflows, structural reforms and the peculiar recent inflation history-can explain that fortunate result. Moreover, it is shown that LAC episodes exhibit a larger speed than G7 experiences. That speed differential explains why disinflation costs in developed nations are on average larger than LAC’s.

Sprache
Englisch

Erschienen in
Series: Working Paper ; No. 506

Klassifikation
Wirtschaft
Price Level; Inflation; Deflation
Business Fluctuations; Cycles
Monetary Policy
Economic Growth of Open Economies
Macroeconomics and Monetary Economics: General
Thema
Inflation
Growth
Disinflation costs
Inflationsbekämpfung
Wirtschaftswachstum
Lateinamerika

Ereignis
Geistige Schöpfung
(wer)
Hofstetter, Marc
Ereignis
Veröffentlichung
(wer)
The Johns Hopkins University, Department of Economics
(wo)
Baltimore, MD
(wann)
2004

Handle
Letzte Aktualisierung
10.03.2025, 11:41 MEZ

Datenpartner

Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.

Objekttyp

  • Arbeitspapier

Beteiligte

  • Hofstetter, Marc
  • The Johns Hopkins University, Department of Economics

Entstanden

  • 2004

Ähnliche Objekte (12)