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On Inflation Determinants and Costs

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  • José De Gregorio

Abstract

The determinants of inflation, its costs, and how to avoid it are important topics in public discussion and economic analysis, especially in countries with long histories of inestability. This paper begins by reviewing the reasons why there is inflation, and then examines its costs. The consequences of adapting economies to live with inflation in order to mitigate its costs are also discussed. Finally, the paper analyzes the costs of stabilization policies and which should be a reasonable objective for long-run inflation.

Suggested Citation

  • José De Gregorio, 1999. "On Inflation Determinants and Costs," Journal Economía Chilena (The Chilean Economy), Central Bank of Chile, vol. 2(1), pages 023-042, April.
    • Handle: RePEc:chb:bcchec:v:2:y:1999:i:1:p:23-42
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