Balance of Payments Constraint and Inflation
This paper describes briefly the main alternatives to the dominant neoclassical theories of inflation, according to which inflation is always a monetary phenomenon. The model develops a cost-push approach, in which raising costs are mainly related to external constraints. Distributive conflict inflation is possible, but is not explored, in order to highlight the novelty of the model. Not only inflation is seen as resulting from balance of payments crises, but fiscal crises also are the result of the initial balance of payments crises within this framework. Fiscal deficits, and all other excess demand pressures, are absent, so that high levels of inflation are compatible with an economy that is bellow full employment, and stabilization is independent of fiscal adjustments.
|Date of creation:||2003|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: (801) 581-7481
Fax: (801) 585-5649
Web page: http://economics.utah.edu
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Olivera, Julio H G, 1970. "On Passive Money," Journal of Political Economy, University of Chicago Press, vol. 78(4), pages 805-14, Part II J.
- Garegnani, Pierangelo, 1984. "Value and Distribution in the Classical Economists and Marx," Oxford Economic Papers, Oxford University Press, vol. 36(2), pages 291-325, June.
- Rowthorn, R E, 1977. "Conflict, Inflation and Money," Cambridge Journal of Economics, Oxford University Press, vol. 1(3), pages 215-39, September.
- Canavese, Alfredo J., 1982. "The structuralist explanation in the theory of inflation," World Development, Elsevier, vol. 10(7), pages 523-529, July.
- de Carvalho, Fernando J Cardim, 1993. "Strato-inflation and High Inflation: The Brazilian Experience," Cambridge Journal of Economics, Oxford University Press, vol. 17(1), pages 63-78, March.
- Cardoso, Eliana A., 1981. "Food supply and inflation," Journal of Development Economics, Elsevier, vol. 8(3), pages 269-284, June.
When requesting a correction, please mention this item's handle: RePEc:uta:papers:2003_06. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.