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Inflation and Poverty

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  • Eliana Cardoso

Abstract

This paper discusses the regressive nature of the inflation tax and she limited extent of its impact on those individuals below the poverty line. It also argues that inflation affects poverty mainly through its impact on real wages: the empirical evidence shows that wages increase more slowly than prices during episodes of rising inflation in Latin America. Finally the paper discusses whether some stabilization programs are less costly in terms of increased poverty than others. Both orthodox programs and attempts to reduce inflation by the implementation of incomes policy have not helped the poor in Latin America.

Suggested Citation

  • Eliana Cardoso, 1992. "Inflation and Poverty," NBER Working Papers 4006, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:4006
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    References listed on IDEAS

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    1. Fox, M. Louise & Morley, Samuel A., 1991. "Who paid the bill? Adjustment and poverty in Brazil, 1980-95," Policy Research Working Paper Series 648, The World Bank.
    2. Levy, Santiago, 1991. "Poverty alleviation in Mexico," Policy Research Working Paper Series 679, The World Bank.
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