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Revisiting the Relationship between Inflation and Growth: A Note on the Role of Exchange Rate Regimes

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  • Andrew Abbott
  • Glauco De Vita

Abstract

Drawing from recent advances in the classification of exchange rate regimes, this note revisits empirically the relationship between inflation and growth under alternative exchange rate regimes. The results, based on a panel of 125 industrialised and developing countries over the period 1980-2004, indicate that the costs of inflation for economic growth are significant only in the case of developing countries, and are higher for floating exchange rates than they are under fixed or intermediate regimes.

Suggested Citation

  • Andrew Abbott & Glauco De Vita, 2011. "Revisiting the Relationship between Inflation and Growth: A Note on the Role of Exchange Rate Regimes," Economic Issues Journal Articles, Economic Issues, vol. 16(1), pages 37-52, March.
    • Handle: RePEc:eis:articl:111cabbott
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    1. VELICU, Ileana Cosînzeana, 2012. "Financing Resources Available For Local Economic Development," Annals of Spiru Haret University, Economic Series, Universitatea Spiru Haret, vol. 3(1), pages 25-36.

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