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Inflation and the poor

Author

Listed:
  • Easterly, William
  • Fischer, Stanley

Abstract

Using polling data for 31,869 households in 38 countries, and allowing for country effects, the authors show that the poor are more likely than the rich to mention inflation as a top national concern. This result survives several robustness checks. Also, direct measures of improvements in well-being for the poor - the change in their share of national income, the percentage decline in poverty, and the percentage change in the real minimum wage - are negatively correlated with inflation in pooled cross-country samples. High inflation tends to lower the share of the bottom quintile and the real minimum wage - and tends to increase poverty.

Suggested Citation

  • Easterly, William & Fischer, Stanley, 2000. "Inflation and the poor," Policy Research Working Paper Series 2335, The World Bank.
  • Handle: RePEc:wbk:wbrwps:2335
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    References listed on IDEAS

    as
    1. Ravallion, Martin & Chen, Shaohua, 1997. "What Can New Survey Data Tell Us about Recent Changes in Distribution and Poverty?," World Bank Economic Review, World Bank Group, vol. 11(2), pages 357-382, May.
    2. Christina D. Romer & David Romer, 1999. "Monetary policy and the well-being of the poor," Economic Review, Federal Reserve Bank of Kansas City, issue Q I, pages 21-49.
    3. Rebecca M. Blank & Alan S. Blinder, 1985. "Macroeconomics, Income Distribution, and Poverty," NBER Working Papers 1567, National Bureau of Economic Research, Inc.
    4. Stanley Fischer & Franco Modigliani, 1978. "Towards an understanding of the real effects and costs of inflation," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 114(4), pages 810-833, December.
    5. Elizabeth T. Powers, 1995. "Inflation, unemployment, and poverty revisited," Economic Review, Federal Reserve Bank of Cleveland, issue Q III, pages 2-13.
    6. Eliana Cardoso, 1992. "Inflation and Poverty," NBER Working Papers 4006, National Bureau of Economic Research, Inc.
    7. David M. Cutler & Lawrence F. Katz, 1991. "Macroeconomic Performance and the Disadvantaged," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 22(2), pages 1-74.
    8. Datt, Gaurav & Ravallion, Martin, 1998. "Why Have Some Indian States Done Better Than Others at Reducing Rural Poverty?," Economica, London School of Economics and Political Science, vol. 65(257), pages 17-38, February.
    9. Lopes, Francisco L. & Bacha, Edmar L., 1983. "Inflation, growth and wage policy : A Brazilian perspective," Journal of Development Economics, Elsevier, vol. 13(1-2), pages 1-20.
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