Article Abstract:
The pricing of foreign inflation in domestic bond market gives a country a relative anti-inflation reputation, while an absolute anti-inflation reputation results if neither domestic nor foreign inflation is priced in the domestic bond market. An empirical measure for anti-inflation reputation spanning over the post-Bretton Woods Agreement period shows that Belgium Japan, Canada and Netherlands lack absolute anti-inflation reputation. While Austria and Switzerland have an absolute anti-inflation reputation, France, Italy and the UK lack both absolute and relative anti-inflation reputation.
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Article Abstract:
Two types of behavior can be examined using a simple, discrete-time model of inflation, rational expectations and adaptive expectations. The adaptive expectations model shows a variety of types of dynamic behavior such as cycles of different lengths and convergence to a state of stability. Adaptive expectations can give rise to chaotic behavior of the rate of inflation in the model, while such chaotic behavior cannot occur with rational expectations.
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Article Abstract:
The high inflation trap phenomenon which has been commonly used by economic theorists as the most likely explanation of hyperinflation is debunked. The trap involves the assumption of dual equilibria and the implementation of a deficit-oriented fiscal policy. It is argued that this factor is not altogether pertinent to the analysis of the inflationary trend. Monetary models need not demonstrate the inevitability of such a factor.
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