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The Rangel curve: origin, development and formalization of Bresser-Pereira and Nakano

Author

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  • Osmani Pontes Moreno
  • André de Melo Modenesi

Abstract

For Rangel inflation is caused by oligopolies and is necessary because it prevents a depression in an economy with low propensity to consume. Facing inflation, government prints money to avoid a liquidity crisis. This conception implies a double opposition to monetarist thought: conceives inflation as functional phenomenon and reverses the causality established by the quantitative equation. Bresser and Nakano were highly influenced by Rangel and stress that inflation is caused by oligopolies and also propose a “sanctioning role” of the state. However, these authors go further Rangel arguing that in recession inflation accelerates thus, formalizing a negative relationship between GDP growth and inflation, according with the so called “Rangel curve”. JEL Classification: B5, B59, E5, E3

Suggested Citation

  • Osmani Pontes Moreno & André de Melo Modenesi, 2014. "The Rangel curve: origin, development and formalization of Bresser-Pereira and Nakano," Brazilian Journal of Political Economy, Center of Political Economy, vol. 34(4), pages 565-586.
    • Handle: RePEc:ekm:repojs:v:34:y:2014:i:4:p:565-586:id:289
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    More about this item

    Keywords

    Rangel curve; inflation; oligopolies; Brazil;
    All these keywords.

    JEL classification:

    • B5 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches
    • B59 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Other
    • E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit
    • E3 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles

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