Towards An Understanding of the Real Effects and Costs of Inflation / Stanley Fischer, Franco Modigliani.

Format:

Book

Author/Creator:

Fischer, Stanley.

Contributor:

National Bureau of Economic Research.

Modigliani, Franco.

Series:

Working Paper Series (National Bureau of Economic Research) no. w0303.

NBER working paper series no. w0303

Language:

English

Subjects (All):

Economic policy.

Economics.

Inflation (Finance).

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 1978.

Cambridge, Massachusetts : National Bureau of Economic Research, 1978.

Summary:

The organization of the paper is simple. We start by examining the real effects of anticipated inflation in an economy that has fully adapted to inflation. In particular, in this economy: (i) public institutions are fully attuned to inflation (or inflation proof), (ii) the same is true of private institutions, (iii) current and future inflation is fully reflected in inherited contracts, and (iv) future inflation is fully reflected in contracts for the future. After we have discussed the effects of anticipated inflation in this environment, we examine the real effects of inflation that arise as the assumptions (i) to (iv) are dropped one after the other. The effects cumulate in the sense that those present in the economy that has fully adapted to inflation are also present in economies with non-inflation proof institutions, and so on.

Notes:

Print version record

November 1978.