Does political instability lead to higher inflation? A panel data analysis

Bibliographic Details
Main Author: Veiga, Francisco José
Publication Date: 2005
Other Authors: Aisen, Ari
Language: eng
Source: Repositórios Científicos de Acesso Aberto de Portugal (RCAAP)
Download full: http://hdl.handle.net/1822/3818
Summary: Economists generally accept the proposition that high inflation rates generate inefficiencies that reduce society’s welfare and economic growth. However, determining the causes of the worldwide diversity of inflationary experiences is an important challenge not yet satisfactorily confronted by the profession. Based on a dataset covering around 100 countries for the period 1960-1999 and using modern panel data econometric techniques to control for endogeneity, this paper shows that a higher degree of political instability is associated with higher inflation. The paper also draws relevant policy implications for the optimal design of inflation stabilization programs and of the institutions favorable to price stability.
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spelling Does political instability lead to higher inflation? A panel data analysisInflationVolatilityPolitical instabilityInstitutionsEconomists generally accept the proposition that high inflation rates generate inefficiencies that reduce society’s welfare and economic growth. However, determining the causes of the worldwide diversity of inflationary experiences is an important challenge not yet satisfactorily confronted by the profession. Based on a dataset covering around 100 countries for the period 1960-1999 and using modern panel data econometric techniques to control for endogeneity, this paper shows that a higher degree of political instability is associated with higher inflation. The paper also draws relevant policy implications for the optimal design of inflation stabilization programs and of the institutions favorable to price stability.Fundação para a Ciência e a Tecnologia (FCT)Universidade do MinhoVeiga, Francisco JoséAisen, Ari20052005-01-01T00:00:00Zconference paperinfo:eu-repo/semantics/publishedVersionapplication/pdfhttp://hdl.handle.net/1822/3818engWORLD CONGRESS OF THE INTERNATIONAL ECONOMIC ASSOCIATION, 13, Marrakech, 2005 – “World Congress of the International Economic Association”. [S. l.: s. n.,] 2005info:eu-repo/semantics/openAccessreponame:Repositórios Científicos de Acesso Aberto de Portugal (RCAAP)instname:FCCN, serviços digitais da FCT – Fundação para a Ciência e a Tecnologiainstacron:RCAAP2024-05-11T05:51:16Zoai:repositorium.sdum.uminho.pt:1822/3818Portal AgregadorONGhttps://www.rcaap.pt/oai/openaireinfo@rcaap.ptopendoar:https://opendoar.ac.uk/repository/71602025-05-28T15:32:30.563061Repositórios Científicos de Acesso Aberto de Portugal (RCAAP) - FCCN, serviços digitais da FCT – Fundação para a Ciência e a Tecnologiafalse
dc.title.none.fl_str_mv Does political instability lead to higher inflation? A panel data analysis
title Does political instability lead to higher inflation? A panel data analysis
spellingShingle Does political instability lead to higher inflation? A panel data analysis
Veiga, Francisco José
Inflation
Volatility
Political instability
Institutions
title_short Does political instability lead to higher inflation? A panel data analysis
title_full Does political instability lead to higher inflation? A panel data analysis
title_fullStr Does political instability lead to higher inflation? A panel data analysis
title_full_unstemmed Does political instability lead to higher inflation? A panel data analysis
title_sort Does political instability lead to higher inflation? A panel data analysis
author Veiga, Francisco José
author_facet Veiga, Francisco José
Aisen, Ari
author_role author
author2 Aisen, Ari
author2_role author
dc.contributor.none.fl_str_mv Universidade do Minho
dc.contributor.author.fl_str_mv Veiga, Francisco José
Aisen, Ari
dc.subject.por.fl_str_mv Inflation
Volatility
Political instability
Institutions
topic Inflation
Volatility
Political instability
Institutions
description Economists generally accept the proposition that high inflation rates generate inefficiencies that reduce society’s welfare and economic growth. However, determining the causes of the worldwide diversity of inflationary experiences is an important challenge not yet satisfactorily confronted by the profession. Based on a dataset covering around 100 countries for the period 1960-1999 and using modern panel data econometric techniques to control for endogeneity, this paper shows that a higher degree of political instability is associated with higher inflation. The paper also draws relevant policy implications for the optimal design of inflation stabilization programs and of the institutions favorable to price stability.
publishDate 2005
dc.date.none.fl_str_mv 2005
2005-01-01T00:00:00Z
dc.type.driver.fl_str_mv conference paper
dc.type.status.fl_str_mv info:eu-repo/semantics/publishedVersion
status_str publishedVersion
dc.identifier.uri.fl_str_mv http://hdl.handle.net/1822/3818
url http://hdl.handle.net/1822/3818
dc.language.iso.fl_str_mv eng
language eng
dc.relation.none.fl_str_mv WORLD CONGRESS OF THE INTERNATIONAL ECONOMIC ASSOCIATION, 13, Marrakech, 2005 – “World Congress of the International Economic Association”. [S. l.: s. n.,] 2005
dc.rights.driver.fl_str_mv info:eu-repo/semantics/openAccess
eu_rights_str_mv openAccess
dc.format.none.fl_str_mv application/pdf
dc.source.none.fl_str_mv reponame:Repositórios Científicos de Acesso Aberto de Portugal (RCAAP)
instname:FCCN, serviços digitais da FCT – Fundação para a Ciência e a Tecnologia
instacron:RCAAP
instname_str FCCN, serviços digitais da FCT – Fundação para a Ciência e a Tecnologia
instacron_str RCAAP
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reponame_str Repositórios Científicos de Acesso Aberto de Portugal (RCAAP)
collection Repositórios Científicos de Acesso Aberto de Portugal (RCAAP)
repository.name.fl_str_mv Repositórios Científicos de Acesso Aberto de Portugal (RCAAP) - FCCN, serviços digitais da FCT – Fundação para a Ciência e a Tecnologia
repository.mail.fl_str_mv info@rcaap.pt
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