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The post-pandemic inflation debate: a critical review

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  • Diogo Martins

Abstract

This article provides a critical review of the post-pandemic inflation debate. The first part structures the debate through the classification of the arguments into two broad categories (the neoclassical view and the critical political economy view) along with several subcategories. The classification is informed by the positions assumed by debate participants regarding the origin and propagation mechanisms of inflation, together with the economic policy solutions advanced to face the current inflationary episode. The second part is focused on showing that the hegemony of contractionary monetary policy as a policy response to address contemporary inflation is based on weak foundations, whose theoretical and empirical arguments have been consistently and convincingly disputed in critical political economy circles over the last decades.

Suggested Citation

  • Diogo Martins, 2024. "The post-pandemic inflation debate: a critical review," Working Papers REM 2024/0308, ISEG - Lisbon School of Economics and Management, REM, Universidade de Lisboa.
    • Handle: RePEc:ise:remwps:wp03082024
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    File URL: https://rem.rc.iseg.ulisboa.pt/wps/pdf/REM_WP_0308_2024.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    Inflation; pandemic; critical political economy; neoclassical economics; central banks; monetary policy.;
    All these keywords.

    JEL classification:

    • E12 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Keynes; Keynesian; Post-Keynesian; Modern Monetary Theory
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
    • E64 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Incomes Policy; Price Policy

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