IDEAS home Printed from https://ideas.repec.org/a/fst/rfsisf/v8y2023i15p181-197.html
   My bibliography  Save this article

The Economic-Social Influences of the Consumer Price Index: The Case of Post-Communist Romania

Author

Listed:
  • Teodora Maria Suciu

    (University "1 Decembrie 1918" Alba Iulia, Alba-Iulia, Romania)

  • Mihaela Ștefan-Hint

    (University "1 Decembrie 1918" Alba Iulia, Alba-Iulia, Romania)

  • Remus Ionuț Ilieș

    (University of Oradea, Oradea, Romania)

Abstract

The consumer price index plays an important role in the current economic-financial activity because the income level is updated with the help of the rate of this index, both in the private environment and in public institutions, which means that if the level of the index is high, salaries or pensions are increased accordingly. The objective of this paper is to examine the impact of the most important aspects related to the consumer price index and some of the most important macroeconomic determinants in Romania. The authors consider this research proposal necessary because it has been observed that the consumer price index influences the economic situation within a country and causes changes in unfavorable directions on macroeconomic indicators. The study is based on a set of statistical data covering the period 1990-2021. The result of econometric model indicates that all the proposed independent variables – economic growth, labor productivity, invested capital, gross salary, net salary, have a significant impact on the consumer price index – the dependent variable. Our opinion is that the consumer price index influences to a large extent the economic and social activity of Romania because following the results of the econometric analysis it was found that Capital investment and Grosswages are the main factors that led to the increase of the Consumer Price Index, while the study presents and some unfavorable directions (Economic Growth, Labour productivity, Net wages) with direct influence on Consumer Price Index.

Suggested Citation

  • Teodora Maria Suciu & Mihaela Ștefan-Hint & Remus Ionuț Ilieș, 2023. "The Economic-Social Influences of the Consumer Price Index: The Case of Post-Communist Romania," Journal of Financial Studies, Institute of Financial Studies, vol. 8(15), pages 181-197, November.
    • Handle: RePEc:fst:rfsisf:v:8:y:2023:i:15:p:181-197
    DOI: 10.55654/JFS.2023.8.15.12
    as

    Download full text from publisher

    File URL: https://revista.isfin.ro/wp-content/uploads/2023/11/12.-Suciu-Teodora.pdf
    Download Restriction: no
    File URL: https://revista.isfin.ro/2023/11/28/the-economic-social-influences-of-the-consumer-price-index-the-case-of-post-communist-romania/
    Download Restriction: no
    File URL: https://libkey.io/10.55654/JFS.2023.8.15.12?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Michael F. Bryan & Stephen G. Cecchetti, 1993. "The consumer price index as a measure of inflation," Economic Review, Federal Reserve Bank of Cleveland, vol. 29(Q IV), pages 15-24.
    2. Hassani, Hossein & Silva, Emmanuel Sirimal, 2018. "Forecasting UK consumer price inflation using inflation forecasts," Research in Economics, Elsevier, vol. 72(3), pages 367-378.
    3. Umaid A. Sheikh & Muzaffar Asad & Aqeel Israr & Mosab I. Tabash & Zahid Ahmed & David McMillan, 2020. "Symmetrical cointegrating relationship between money supply, interest rates, consumer price index, terroristic disruptions, and Karachi stock exchange: Does global financial crisis matter?," Cogent Economics & Finance, Taylor & Francis Journals, vol. 8(1), pages 1838689-183, January.
    4. Sweidan, O.D., 2004. "Does Inflation Harm Economic Growth in Jordan?. An Econometric Analysis for the Period 1970-2000," International Journal of Applied Econometrics and Quantitative Studies, Euro-American Association of Economic Development, vol. 1(2), pages 41-66.
    5. Asma Fiaz & Nabila Khurshid & Ahsan ul Haq Satti, 2022. "Revisiting the macroeconomic variables and economic growth nexus: A Markov regime-switching approach," Economic Journal of Emerging Markets, Universitas Islam Indonesia, vol. 14(1), pages 101-112.
    6. Geert Woltjer & Michiel van Galen & Katja Logatcheva, 2021. "Industrial Innovation, Labour Productivity, Sales and Employment," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 28(1), pages 89-113, January.
    7. By Mohsin S. Khan & Abdelhak S. Senhadji, 2001. "Threshold Effects in the Relationship Between Inflation and Growth," IMF Staff Papers, Palgrave Macmillan, vol. 48(1), pages 1-1.
    8. Max Gillman & Michal Kejak, 2011. "Inflation, Investment and Growth: a Money and Banking Approach," Economica, London School of Economics and Political Science, vol. 78(310), pages 260-282, April.
    9. Fredrik NG Andersson, 2011. "Monetary Policy, Asset Price Inflation and Consumer Price Inflation," Economics Bulletin, AccessEcon, vol. 31(1), pages 759-770.
    10. Zekeriya Yildirim, 2015. "Relationships among labour productivity, real wages and inflation in Turkey," Economic Research-Ekonomska Istraživanja, Taylor & Francis Journals, vol. 28(1), pages 85-103, January.
    11. Jakob B. Madsen, 2003. "Inflation and Investment," Scottish Journal of Political Economy, Scottish Economic Society, vol. 50(4), pages 375-397, September.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Venky Venkateswaran & Randall Wright, 2014. "Pledgability and Liquidity: A New Monetarist Model of Financial and Macroeconomic Activity," NBER Macroeconomics Annual, University of Chicago Press, vol. 28(1), pages 227-270.
    2. Nell, Kevin, 2023. "Inflation and growth in developing economies: A tribute to Professor Thirlwall," MPRA Paper 118757, University Library of Munich, Germany, revised 01 Sep 2023.
    3. Nicas Yabu & Nicholaus J. Kessy, 2015. "Appropriate Threshold Level of Inflation for Economic Growth: Evidence from the Three Founding EAC Countries," Applied Economics and Finance, Redfame publishing, vol. 2(3), pages 127-144, August.
    4. Ahortor, Christian R.K. & Adenutsi, Deodat E., 2009. "Inflation, capital accumulation and economic growth in import-dependent developing countries," MPRA Paper 29353, University Library of Munich, Germany, revised 2010.
    5. Ablam Estel Apeti & Jean-Louis Combes & Eyah Denise Edoh, 2023. "Entrepreneurship in developing countries: can mobile money play a role?," Working Papers hal-04081304, HAL.
    6. Phiri, Andrew, 2013. "Inflation and Economic Growth in Zambia: A Threshold Autoregressive (TAR) Econometric Approach," MPRA Paper 52093, University Library of Munich, Germany.
    7. Noura Abu Asab & Alaaeddin Al-Tarawneh, 2018. "The Impact of Inflation on Investment: The Non-Linear Nexus and Inflation Threshold in Jordan," Modern Applied Science, Canadian Center of Science and Education, vol. 12(12), pages 113-113, December.
    8. Rufin-Willy Mantsie, 2012. "In Search of Inflation Rate Compatible with Growth Target in CEMAC Countries," Brussels Economic Review, ULB -- Universite Libre de Bruxelles, vol. 55(4), pages 329-350.
    9. Muhammad Azam & Saleem Khan, 2022. "Threshold effects in the relationship between inflation and economic growth: Further empirical evidence from the developed and developing world," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 27(4), pages 4224-4243, October.
    10. Vaona, A. & Schiavo, S., 2007. "Nonparametric and semiparametric evidence on the long-run effects of inflation on growth," Economics Letters, Elsevier, vol. 94(3), pages 452-458, March.
    11. Saaed, A.A.J., 2007. "Inflation and Economic Growth in Kuwait: 1985-2005. Evidence from Co-Integration and Error Correction Model," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 7(1).
    12. Myint Moe Chit, 2018. "Political openness and the growth of small and medium enterprises: empirical evidence from transition economies," Empirical Economics, Springer, vol. 55(2), pages 781-804, September.
    13. Baharumshah, Ahmad Zubaidi & Slesman, Ly & Wohar, Mark E., 2016. "Inflation, inflation uncertainty, and economic growth in emerging and developing countries: Panel data evidence," Economic Systems, Elsevier, vol. 40(4), pages 638-657.
    14. Limam Ould Mohamed Mahmoud, 2015. "Consumer price index and economic growth: A case study of Mauritania 1990 - 2013," Asian Journal of Empirical Research, Asian Economic and Social Society, vol. 5(2), pages 16-23, February.
    15. Mehmet Balcilar & Rangan Gupta & Charl Jooste, 2014. "The Growth-Inflation Nexus for the US over 1801-2013: A Semiparametric Approach," Working Papers 201447, University of Pretoria, Department of Economics.
    16. Muhammad Farooq Arby & Amjad Ali, 2017. "Threshold Inflation in Pakistan," SBP Research Bulletin, State Bank of Pakistan, Research Department, vol. 13, pages 1-19.
    17. Assaf Razin, 2004. "Aggregate Supply and Potential Output," NBER Working Papers 10294, National Bureau of Economic Research, Inc.
    18. Kuang‐Liang Chang & Chi‐Wei He, 2010. "Does The Magnitude Of The Effect Of Inflation Uncertainty On Output Growth Depend On The Level Of Inflation?," Manchester School, University of Manchester, vol. 78(2), pages 126-148, March.
    19. Abhinandan Kulal & Deepak Kallige Vishwanath & Sanath Kumar Kanthila, 2023. "Dynamic Relationship Between Rupee-Dollar Exchange Rate and Major Economic Indicators," American Journal of Economics and Business Administration, Science Publications, vol. 15(1), pages 18-30, August.
    20. Ilker Domaç & Eray M. Yücel, 2005. "What Triggers Inflation in Emerging Market Economies?," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 141(1), pages 141-164, April.

    More about this item

    Keywords

    Consumer Price Index; regression analysis; Ordinary Least Square; macroeconomic factors; Romania case.;
    All these keywords.

    JEL classification:

    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • F37 - International Economics - - International Finance - - - International Finance Forecasting and Simulation: Models and Applications
    • F47 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Forecasting and Simulation: Models and Applications

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fst:rfsisf:v:8:y:2023:i:15:p:181-197. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Cosmin Catalin Olteanu (email available below). General contact details of provider: https://edirc.repec.org/data/isfinro.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.