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Inflation, Innovation and Growth: A Survey

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  • Chu, Angus C.

Abstract

In this survey, we provide a selective review of the literature on inflation, innovation and economic growth. The relationship between inflation and economic growth is a fundamental question in economics. Most studies in this literature explore this relationship in capital-based growth models. This survey reviews a recent branch of this literature on inflation and innovation-driven growth. Specifically, we develop a canonical monetary Schumpeterian growth model to demonstrate the effects of inflation on innovation and the macroeconomy via different channels. We find that the cash-in-advance constraints on consumption and R&D investment have drastically different implications on the macroeconomic effects of inflation.

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  • Chu, Angus C., 2020. "Inflation, Innovation and Growth: A Survey," MPRA Paper 103740, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:103740
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    Cited by:

    1. Bao-We-Wal BAMBE & Jean Louis COMBES & Kabinet KABA & Alexandru MINEA, 2022. "Inflation Targeting and Developing countries’ Performance: Evidence from Firm-Level Data," LEO Working Papers / DR LEO 2941, Orleans Economics Laboratory / Laboratoire d'Economie d'Orleans (LEO), University of Orleans.
    2. Sequeira, Tiago Neves, 2021. "Inflation, economic growth and education expenditure," Economic Modelling, Elsevier, vol. 99(C).
    3. He, Qichun & Wang, Xilin, 2020. "Money, Human Capital and Endogenous Market Structure in a Schumpeterian Economy," MPRA Paper 104609, University Library of Munich, Germany.

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    More about this item

    Keywords

    inflation; innovation; economic growth;
    All these keywords.

    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity

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