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South Africa's inflation: Monetary or fiscal

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Listed:
  • Guangling Liu
  • Christopher D. Solomon

Abstract

Conventional macroeconomics has viewed inflation as a monetary phenomenon through the Quantity Theory of Money. Ever-increasing sovereign debt globally has caused concern among economists. These concerns follow not from the ability of governments to repay their debt, but rather from the impact of sizeable debt portfolios on price levels. The Fiscal Theory of the Price Level epitomizes these concerns, contrasting the traditional view on inflation by arguing that it is a fiscal phenomenon caused by debt issuance without real backing.

Suggested Citation

  • Guangling Liu & Christopher D. Solomon, 2025. "South Africa's inflation: Monetary or fiscal," WIDER Working Paper Series wp-2025-52, World Institute for Development Economic Research (UNU-WIDER).
    • Handle: RePEc:unu:wpaper:wp-2025-52
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    File URL: https://www.wider.unu.edu/sites/default/files/Publications/Working-paper/PDF/wp2025-52-south-africas-inflation.pdf
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    References listed on IDEAS

    as
    1. Michael Woodford, 1998. "Doing Without Money: Controlling Inflation in a Post-Monetary World," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 1(1), pages 173-219, January.
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