Propogation of Shocks in a High-Inflation Economy: Israel, 1980-85 / Leonardo Leiderman, Assaf Razin.

Format:

Book

Author/Creator:

Leiderman, Leonardo.

Contributor:

National Bureau of Economic Research.

Razin, Assaf.

Series:

Working Paper Series (National Bureau of Economic Research) no. w2003.

NBER working paper series no. w2003

Language:

English

Subjects (All):

Economic history.

Economic conditions.

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Propogation of Shocks in a High-Inflation Economy

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 1986.

Cambridge, Mass. : National Bureau of Economic Research, 1986.

Summary:

The purpose of this paper is to provide empirical answers to questions related to the propagation of shocks in a high-inflation economy. Do one-time inflationary shocks give rise to long-term persistence, or inertia? Do balance of payments' shocks trigger a process that, through indexation and monetary accommodation, results in long-term changes in inflation? Within the context of a specific hypothesis, influential both in policy discussions and in economic analyses, the paper addresses these issues using Israeli data and vector-autoregression techniques. The evidence does not support the hypothesis that one-time nominal shocks have a persistent effect on the inflation rate, or the hypothesis that long-term changes in inflation are triggered by autonomous fluctuations in the trade balance.

Notes:

Print version record

August 1986.