the missing link intra country evidence on the relationship between high and uncertain inflation from high inflation countries the notion that high inflation breeds high uncertainty about future inflation is widely accepted this acceptance is based largely on a positive correlation between the mean and variability of inflation across countries 2 this positive relationship is taken as evidence that high inflation creates high uncertainty 3 recently though driffill mizon and ulph 10 have questioned the relevance of this cross country evidence for making inferences about welfare issues within countries they argue that it is the relationship between the time series mean and variance within a country that is important when considering the potential costs of inflation in this paper we examine the within country time series link between the level and uncertainty of inflation for ten countries that experienced a period of very high inflation we use data generated from regression based forecasts of inflation and historical data on actual forecasts our sample does not provide evidence of a general positive link within these countries the ten countries we study are argentina bolivia brazil chile colombia israel mexico peru turkey and uruguay in these countries the average annualized rate of inflation from the quarterly data in our sample was about 54 per year and the average sample standard deviation

are higher levels of inflation less predictable a state dependent conditional heteroscedasticity approach milton friedman proposed that there is a positive relationship between inflation and uncertainty about the future path of inflation in contrast to previous studies of this hypothesis we find strong statistical evidence that higher levels of inflation are less predictable although innovations in inflation are somewhat better predictors of future volatility than the actual level of inflation we argue that previous failures to find an inflation uncertainty relationship are due to two factors first none of the previous work directly tested friedman s hypothesis by including the level of inflation in the model of the conditional variance second these studies also used symmetric models which appears inconsistent with friedman s hypothesis our results are robust to different sample periods and to assumptions about the presence of a unit root in inflation to test the inflation uncertainty hypothesis we use state dependent models sdm s of conditional moments to estimate the time varying conditional v

inflation output growth and nominal and real uncertainty empirical evidence for the g7 abstract we use univariate garch models of inflation and output growth and monthly data for the g7 covering the 1957 2000 period to test for the causal effect of real and nominal macroeconomic uncertainty on inflation and output growth and the effect of inflation on inflation uncertainty our evidence supports a number of important conclusions first inflation is a positive determinant of uncertainty about inflation second output growth uncertainty is a positive determinant of the output growth rate third there is mixed evidence regarding the effect of inflation uncertainty on inflation and output growth hence uncertainty about the inflation rate is not necessarily detrimental to economic growth finally there is not much evidence supporting the hypothesis that output uncertainty raises inflation

repressed inflation queuing and the resale of goods in a centrally planned economy abstract the barro grossman repressed inflation model is reformulated incorporating the goods rationing scheme widely observed in centrally planned economies the informal queue we assume there are two types of individual differntiated by work ability this enables inclusion of another feature found in practice the private resale of goods less able individuals queue to buy goods both to consume and to resell to more able individuals the latter spend their time working for a relatively high wage rather than queuing among the comparative statics results is that the supply multiplier is negative positive if goods and leisure are gross substitutes complements

an examination of aggregate price uncertainty in four countries and someimplications for real output this stu dy constructs measures of aggregate price uncertainty for four countries canada west germany great britain and the united states and examines the relationship across countries and through time between the inflation rate inflation variability and measures of price uncertainty the results suggest that the higher and more variable inflation of the 1970s increased uncertainty about the aggregate price level in canada great britain and the united states but not west ge rmany and there was a significant negative output effect of aggregate price uncertainty for canada and the united kingdom but not for the united states or west germany copyright 1987 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association

the welfare costs of rationing by waiting with price controls and rationing by waiting rational consumers increase the quantity boughtperpurchase this individually rational response is socially wasteful and the cost of making it is a deadweight loss this cost plus the value of time spent in queues may exceed the total rent transferred from suppliers to consumers by price controls i e the value of resources spent competing for the rent may exceed the rent itself this point is illustrated by an empirical application to gasoline price controls rent seeking exhausts an estimated 116 percent of the rent trangerred the efficiency of the price system is often illustrated lby pointing to the obvious wastes associated with alternative allocation mechanisms for example the queues that accompany price controls and first come first served allocations although rationing by waiting wastes resources in a dramatically visible fashion the magnitude of the waste and the factors that determine it seldom have been examined empirically moreover existing theory on the subject is incomplete unless the first come first served rule is precisely specified consumers will compete for available supplies in ways other than waiting in the model developed below queues cause consumers to compete by increasing amounts bought per trip to the market the analysis demonstrates that such individually rational adjustments only increase the welfare cost of rationing by waiting and thus are socially self defeating the theoretical model is illustrated empirically by estimating the welfare costs of a market wide ceiling on gasoline prices this application was motivated by the availability of two key pieces of information the value of time spent in gasoline queues and the effect of waiting lines on amounts bought per purchase this information was obtained from a survey of motorists conducted during the era of federal gasoline price regulations to focus on competition among consumers one of the inefficiencies that results from price controls is ignored the supply reduction leading to the

inflation and inflation uncertainty in china abstractthe study examines the relationship between inflation and inflation uncertainty in china using generalized autoregressive conditional heteroscedasticity model particularly this link is investigated in china s urban and rural sectors motivated by the substantial urban rural divide the results provide strong statistical supportive evidence that higher inflation raises inflation uncertainty on the other hand evidence on the effect of inflation uncertainty on inflation is mixed depending on the sample periods and areas examined the understanding of inflation uncertainty nexus in china could provide implications to policymakers in the adoption of monetary policies

inflation and inflation uncertainty in turkey this article investigates the relationship between inflation and inflation uncertainty and the impact of monetary policy on this relationship using monthly turkish inflation data over january 1984 to october 2005 the results from various types of garch m models indicate that higher inflation rates lead to greater inflation uncertainty on the other hand the effect of inflation uncertainty on inflation is found to be negative due to stabilization motives dominating the opportunistic incentives of monetary authorities we find strong evidence to support the view that inflation oriented monetary policy has power to reduce the inflation persistence and eliminate uncertainty

the influence of black markets on a queue rationed centrally planned economy abstract in centrally planned economies in which prices are fixed and the rationing mechanism is waiting line queues we show that an equilibrium of waiting times exists we then introduce a black market in which individuals can trade commodities that they have acquired through the official economy an equilibrium of black market prices and waiting times is shown to exist further the economy with a black market is queue efficient however the introduction of black markets is not necessarily a pareto improvement over an economy without black markets even when we allow winners to compensate losers

reform in eastern europe a general equilibrium model with distortions in relative prices and factor markets this paper presents an analysis of reforms using a simple general equilibrium model with production the model illustrates some of the distortions remaining in the eastern european countries as they adopt market oriented policies and it shows that price reforms should take priority if simultaneous reform is not possible specifically the authors examine reforms of relative prices of output goods and liberalization of the capital market the model is solved numerically showing that restrictions on capital mobility should be retained until after price distortions have been removed

the link between macroeconomic performance and variability in the uk abstract this paper examines the link between inflation output growth and their respective variabilities we employ a bivariate garch model which incorporates mean and level effects to investigate in a unified empirical framework all the possible interactions between the four variables we show that not only does variability affect performance but the latter influences the former as well specifically inflation has a positive impact on both variabilities

a theory of ambiguity credibility and inflation under discretion and asymmetric information this paper develops a positive theory of credibility ambiguity and inflation under discretion and asymmetric information the monetary policymaker maximizes his own politically motivated objective function that is positively related to economic stimulation through monetary surprises and negatively related to monetary growth the relative importance he assigns to each target shifts stochastically through time his current preference trade off is known to him but not to the public when choosing the state contingent path of money growth for the present and the future the policymaker compares the benefits from current stimulation with the costs associated with higher future inflation expectations current monetary growth conveys information to the public about future money growth because there is persistence in the policymaker s objectives although expectations are rational information is imperfect because monetary control procedures are imprecise as a result the public cannot correctly distinguish persistent changes of emphasis on different policy objectives from transitory monetary control errors the public becomes aware of changes gradually by observing past monetary growth credibility is defined in terms of the speed with which the public recognizes changes in the objectives of the policymaker credibility is lower the noisier monetary control and the more stable the objectives of the policymaker looser monetary control and a higher degree of time preference on the part of the policymaker induce him to produce higher and more variable monetary growth when the policymaker is free to determine the accuracy of monetary control he does not always choose the most effective control available in spite of the fact that monetary surprises always have an expected value of zero the reason is that ambiguous control procedures enable the policymaker to generate positive surprises when he cares more than on average about economic stimulation he leaves the inevitable negative surprises for periods in which he cares more about inflation prevention this result provides an explanation for the fed s preference for ambiguity recently documented by goodfriend 1986 the policymaker is more likely to pick more ambiguous control procedures the more uncertain his objectives and the higher his time preference the paper also provides a theoretical underpinning for the well documented crosscountry positive correlation between the level and the variability of inflation

a quantile framework for analysing the links between inflation uncertainty and inflation dynamics across countries in contrast to the conventional conditional mean approaches this study uses quantile regression techniques to present some new statistical evidence on the links between inflation uncertainty and the level of inflation with cross sectional data from 90 countries during the period 1961 to 2006 the results suggest that positive inflation shocks have stronger impact on inflation uncertainty which varies across the quantiles furthermore popular time series models are evaluated for their ability to reproduce measures of uncertainty and indicate similar results regarding the relationships between inflation and inflation uncertainty

the marginals never vanished incumbency and competition in elections to the u s house of representatives 1952 82 the average vote margin enjoyed by incumbent candidates for the u s house of representatives increased sharply during the 1 960s despite this and contrary to assumptions common in the literature on recent congressional elections electoral data show that house incumbents are no safer now than they were in the 1950s the marginals properly defined have not vanished the swing ratio has diminished little if at all and competition for house seats held by incumbents has not declined vote margins increased without adding to incumbent security diminishing competition or dampening swings because the heterogeneity of interelection vote swings increased at the same time

uncertain effects of money and the link between the inflation rate and inflation uncertainty in the postwar period high rates of inflation are associated with high levels of inflation uncertainty in this paper i argue that the inflation rate and inflation uncertainty are linked by forecasters uncertainty about the impact of money growth on the price level and i present evidence indicating that this has been the case as long as the impact of money growth on the price level remains unpredictable then even predictable money growth will cause inflation uncertainty with its accompanying adverse effects on employment and output

macroeconomic uncertainty and performance in the european union abstract we use a very general bivariate garch m model and monthly data on eu countries covering the 1962 2003 period to test for the impact of real output growth and nominal inflation macroeconomic uncertainty on inflation and output growth our evidence supports a number of important conclusions first in the majority of countries uncertainty regarding the output growth rate is related to the average growth rate and the effect in several countries is negative second in half of the cases there is no significant relationship between inflation uncertainty and output growth performance third inflation and output uncertainty have a mixed effect on inflation nevertheless considerable evidence for the cukierman meltzer hypothesis is obtained our conclusions are based on adopting both a structural and a reduced form bivariate garch model finally we also find statistically significant evidence of regime switching for both inflation and output growth volatility throughout the sample

the transition to a market economy pitfalls of partial reform we present a theory of a partial economic reform of a planned economy similar to the one that took place in russia since 1988 and in china earlier in such a reform some markets are liberalized in the sense that producers can sell output to whomever they want including private firms at free prices but at the same time must sell to state firms at state prices we show that such a reform can result in a substantial diversion of subsidized inputs away from state firms and toward private firms even when state firms value these inputs more the result may be a reduction of total output the simple analysis sheds light on many consequences of the soviet reform such as breakdown of coordination of production increased state policing of delivery quotas prohibitions of trading cooperatives and opposition to privatization the model also explains why partial reform failed in russia but worked in china

the industrial organization of congress or why legislatures like firms are not organized as markets this paper provides a theory of legislative institutions that parallels the theory of the firm and the theory of contractual institutions like market institutions legislative institutions reflect two key components the goals or preferences of individuals here representatives seeking reelection and the relevant transactions costs we present three conclusions first we show how the legislative institutions enforce bargains among legislators second we explain why given the peculiar form of bargaining problems found in legislatures specific forms of nonmarket exchange prove superior to market exchange third our approach shows how the committee system limits the types of coalitions that may form on a particular issue

changes in the vote margins for congressional candidates a specification of historical trends recent research on house elections has focused on the decline in congressional competition since the mid 1960s however this body of research suffers from three major problems 1 an imprecise specification of the nature of change in the degree of congressional competition 2 its exclusive reliance on a limited time frame which calls into question the generalizability and adequacy of its explanations and 3 its overemphasis on incumbency oriented explanations using a multiple interrupted time series mits analysis of trends in aggregate electoral data from 1824 to 1980 we find that current low levels of congressional competition are not historically unique but instead constitute a continuation of a long term trend established in the mid 1890s in addition and in contrast to the general thrust described in the literature there appears to be a post 1965 trend toward greater competition although the absolute level of competition is lower after the mid 1960s finally a disaggregation of electoral results by incumbency status suggests a growth in the incumbency advantage since the mid 1890s but that lower post 1965 levels of congressional competition are the result of a winners and not an incumbency advantage such findings cast doubt on the adequacy of explanations that focus on post 1965 incumbency oriented factors

exploring long run relationship and error correction of thai output and price as the thai economy has integrated into the world system it increasingly endures not only internal circumstances but also external turmoils stabilizing the country s growth and inflation from macroeconomic shocks has then become a challenge to policymakers this study thus concentrates on investigating the long run relationship and the adjustment process towards the equilibrium of output and price of thailand from 2001 to 2014 for this purpose the dynamic relationship cointegration property and error correction term are explored by dols various cointegration tests and ecm the cointegration test also remarks the possibility of monetary policymakers to surprise the market in order to expect the increase in output it also reconfirms that the interest rate tends to be a passive monetary instrument in curbing inflationary moreover the adjustment process to the long run of both output and price is found to have a symmetric cointegration property which implies the systematic ecm the symmetric error correction test presents the significantly negative elimination in the next quarter towards long term equilibrium the monetary policymakers thus seem to react to the rise in inflation uncertainty by keeping down inflation meanwhile the output level tends to have faster adjustment speed than that of the price level

re examining inflation and inflation uncertainty in developed and emerging countries abstract this paper examines the relationship between inflation and inflation uncertainty for both developed and emerging countries we find new evidence that suggests positive inflationary shocks have stronger impacts on inflation uncertainty for mainly latin american countries

microeconomic issues in the transition to a market economy evidence from developing countries suggests that a one sided preoccupation with macroeconomic issues may be unfortunate as macro stabilization programs tend to unravel in the presence of an inadequate micro adjustment for example kiguel and liviatan 1990 this finding is important because the socialist system introduced microeconomic distortions that probably transcend those observed in the third world the recent developments in poland yugoslavia and the soviet union also support the hypothesis that macro stabilization will be difficult to achieve in the transforming socialist economies in the absence of adequate micro adjustments in this paper i address what i consider to be the most important micro issues related to the transition from socialist to market economies i first summarize the initial microeconomic conditions and then describe the main changes that have taken place in the early stages of the transition finally i discuss the micro policy agenda that needs to be addressed if the transition is to be successful

general equilibrium analysis of price controls a computational approach this paper presents a computational general equilibrium framework for evaluating the welfare costs associated with economy wide price controls other than traditional commodity specific partial equilibrium analyses most empirical literature on price controls concentrates on macroeconomic issues such as the impact on inflation and unemployment here we seek to reorient empirical literature on the effects of these controls towards efficiency losses from resource misallocation by providing a framework which can be used to address the issue of how large these economic inefficiencies are and who gains and who loses from them in this paper we present a general equilibrium computational framework for evaluating the welfare costs associated with economy wide price controls price controls have been employed by governments all over the world during war and peace in response to all manners of threats both real and imaginary and in all ages 2 other than traditional commodity specific partial equilibrium analyses most empirical literature on price controls concentrates on macroeconomic issues such as the impact on inflation and unemployment despite the fact that the main attack on price controls is usually in terms of their efficiency losses from resource misallocation here we seek to reorient the empirical literature on the effects of the controls by providing a framework which can be used to address the issue of how large these economic inefficiencies are and who gains and who loses from them we use a general equilibrium model in which the equilibrium mechanism in the presence of price controls is endogenously determined search costs these yield additional welfare losses under price controls beyond those associated with more traditional tax or tariff models the argument is that in an economy with price controls the greater the difference between controlled and market clearing prices the costlier it is for buyers and sellers to find each other and transact a similar approach has been taken recently in two other papers in which we have been involved see nguyen 1985 nguyen and whalley 1986 the difference here is that unlike these earlier papers we explicitly incorporate production and apply our approach to the issue of economy wide controls using data for an actual economy since either the buying or selling side of a price controlled market can be

inflation output and uncertainty in the era of inflation targeting a multi economy view on causal linkages abstract this study provides cross country robust evidence on interdependencies among inflation output growth and respective uncertainties for the current era of low inflation policies we attribute the extant empirical disagreement on these relations to the fact that long sampling periods and single economies are typically considered for analysis in this study varx mgarch m models are estimated for 34 developed and emerging economies and the time period of 1990 2010 we study average granger causal effects by aggregating parameter estimates over economies the cross sectional variation of estimates serves as a means to assess the robustness of empirical findings over the entire cross section we find that both inflation and inflation uncertainty significantly reduce output growth economies with low inflation rates are particularly at risk to incur output losses from increasing inflation we also find spillover effects among uncertainty variables where the causal impact if present seems to point from the uncertainty in output to inflation uncertainty

inflation and inflation volatility in thailand abstractquarterly data for thailand are used in this article for the period 1965q3 2013q4 to investigate both the relationship between inflation and inflation volatility and the impact of inflation volatility on economic growth inflation volatility is estimated by deploying the generalized autoregressive conditional heteroscedastic garch technique a granger causality test is then conducted to examine the causality between inflation and inflation volatility the empirical results obtained are consistent with a number of theoretical propositions first the results are consistent with the friedman ball proposition which states that a rise in inflation raises inflation volatility second there is evidence supporting the holland proposition that inflation volatility lowers the rate of inflation this is consistent with the view that central banks attempt to stabilize inflation with the rise in inflation volatility third empirical results obtained by asymmetric garch models suggest that inflation shoc

the asymmetric effects of uncertainty on inflation and output growth we study the effects of growth volatility and inflation volatility on average rates of output growth and inflation for post war us data our results suggest that increased growth uncertainty is associated with significantly lower average growth while higher inflation uncertainty is significantly negatively correlated with lower output growth and lower average inflation both inflation and growth display evidence of significant asymmetric response to positive and negative shocks of equal magnitude copyright 2004 john wiley sons ltd

declining electoral competitiveness in the house of representatives the differential impact of improved transportation technology this paper advances the hypothesis that improvements in the national transportation and communication infrastructure are responsible for the vanishing marginals or the increased electoral security of u s representatives we assume that margin and security are directly affected by the amount of time a legislator or a member of her staff devotes to direct contact with constituents in the home district formally we demonstrate that a decline in the time opportunity cost associated with travel to the district improves victory margins where we proxy improvement in transportation technology by using a distance variable across three different historical samples 1890 1928 and 1970 this proposition offers a potentially more fundamental explanation of declining electoral competition than existing explanations focusing on professionalism careerism redistricting and bureaucratic casework in fact the technology communication hypothesis may well encompass such explanations the model specified here offers at best a crude test of the hypothesis that technology and communication are the cause of the vanishing marginals a superior test would include the actual time required to travel to each district in each sample year because a closer but more inaccessible location would be less electorally favorable according to the logic underlying our model while distance is therefore an imperfect proxy we are encouraged by the results of the preliminary test the next step for future research is to identify which technological innovations have had the greatest impact in order to accomplish this a more complete model of the link between legislators and constituents must be established

eoq and inflation uncertainty abstract inflation uncertainty is introduced into a basic eoq model and its potential to make mischief is explored among other things it is shown that even when the expected rate of inflation is less than the marginal cost of capital the appropriate discount rate to use in computing a discounted expected total inventory cost will not necessarily be negative therefore the classic eoq square root formula may drastically underestimate the optimal lot size the results may be generalized to the more complex inventory models

are empirical measures of macroeconomic uncertainty alike there is a plethora of time series measures of uncertainty for inflation and real output growth in empirical studies but little is known whether they are comparable to the uncertainty measure reported by individual forecasters in the survey of professional forecasters are these two measures of uncertainty inherently distinct this paper shows that compared with many uncertainty proxies produced by time series models the use of real time data with fixed sample recursive estimation of an asymmetric bivariate generalized autoregressive conditional heteroskedasticity model yields inflation uncertainty estimates which resemble the survey measure there is however overwhelming evidence that many of the time series measures of growth uncertainty exceed the level of uncertainty obtained from survey measure our results highlight the relative merits of using different methods in modelling macroeconomic uncertainty which are useful for empirical researchers

the relationship between inflation and inflation uncertainty in emerging market economies a standard generalized autoregressive conditional heteroskedastic q v model is employed to construct a measure of monthly inflation uncertainty in 12 emerging market economies and the relationship between inflation and inflation uncertainty is examined using granger causality tests the results suggest that higher inflation rates increased inflation uncertainty in all the economies providing strong support for the friedman hypothesis the evidence on the effect of inflation uncertainty on average monthly inflation is more mixed with increased inflation uncertainty leading to lower average inflation in colombia israel mexico and turkey consistent with the holland hypothesis but to higher average inflation in hungary indonesia and korea consistent with the hypothesis of cukierman and meltzer

stochastic volatility in a macro finance model of the u s term structure of interest rates 1961 2004 this paper generalizes the standard homoscedastic macro finance model by allowing for stochastic volatility using the square root specification of the mainstream finance literature empirically this specification dominates the standard model because it is consistent with the square root volatility found in macroeconomic time series thus it establishes an important connection between the stochastic volatility of the mainstream finance model and macro economic volatility of the okun friedman type this research opens the way to a richer specification of both macro economic and term structure models incorporating the best features of both macro finance and mainstream finance models

inflation uncertainty and labour market conditions in the us recent inflation dynamics in the united states us questioned the role of driving forces of inflation in the long run although the us recorded one of the longest economic recovery periods and the

rationing queues and black markets several types of rationing and queue mechanisms are compared in a framework of general equilibrium type models under gross substitutability and normality assumptions about consumers walrasian demand during transition from rationing and queues to a market system a group of low income people loses the transition involves larger losses for this group if black markets prevail under rationing or queues while a group of high income consumers gains some other comparative statics results are developed for a queue model with black markets copyright 1993 by the econometric society

equilibrium under price controls with endogenous transactions costs abstract in this paper we present an equilibrium model for an exchange economy with fixed prices and endogenously determined search or transactions costs given the fixed prices endogenously determined equilibrium buying and selling prices which include transactions costs result these costs occur on either the demand or supply side of each market but not both we see an eventual application of this approach to an evaluation of welfare costs of either economy wide wage and price controls or sector specific price controls such as energy in the final section we present some simple numerical examples which illustrate the approach

incumbency electoral safety and turnover in the house of representatives 1952 76 two hypotheses have received a great deal of attention from students of congressional elections first many analysts have concluded that an increase in the electoral value attached to incumbency accounts for the rise in incumbents victory margins observed since the mid sixties second many scholars have attributed the decline in electoral turnover to the percentage increase in victory margins analyzing the electoral histories of 13 house cohorts 1952 76 this study reexamines these two hypotheses within theframework of a quasi experimental design the results presented here in contrast to those of previous studies cast doubt on the increased incumbency effect moreover little relationship is found between an increase in electoral safety as reflected by increased victory margins and a decline in electoral turnover

estimates of the variance of u s inflation based upon the arch model it is generally agreed that the unpredictability of future inflation is a major component of the welfare loss associated with inflation perfectly predicted inflation might induce some costs through institutional rigidities governmental interference and transaction costs but in the long run these should be rather minimal as these institutions adopt various forms of indexing when inflation is unpredictable risk averse economic agents will incur a loss even if prices and quantities are perfectly flexible in all markets inflation is a measure of the relative price of goods today and goods tomorrow thus uncertainty in tomorrow s price impairs the efficiency of today s allocation decisions friedman in his nobel lecture 8 argues convincingly that higher variability of inflation would lead to decreased output ceteris paribus he then conjectures that higher rates of inflation are generally associated with higher variability of inflation and presumably greater uncertainty about future rates if this is true then higher rates of inflation would also be associated with low levels of output which implies a positively sloped phillips curve this paper uses a new statistical technique arch to estimate the conditional mean and variance of inflation from u s time series data the main finding is that the variance of inflation in the seventies was only slightly greater than in the sixties

the benefits of relationship lending in a cross country context a meta analysis relationship lending may create benefits for borrowers by reducing information asymmetries however empirical evidence is mixed we conduct a meta analysis to summarize and explain the heterogeneity in the results in the literature using hand collected information from 101 studies in the united states europe asia and latin america from 1970 to 2010 we find that strong relationships are generally beneficial for borrowers but lending outcomes differ across the relationships dimensions long lasting exclusive and synergy creating bank relationships are associated with higher credit volume and lower loan rates these benefits are more likely in the united states and in countries where bank competition is high they are not related to the importance of small and medium sized enterprises in an economy suggesting that prevalence of relationship lending does not necessarily come along with borrower benefits our inferences are robust when we control for observed systematic heterogeneity in the original

on inflation and inflation uncertainty in the g7 countries abstract the relationship between inflation and inflation uncertainty is investigated in the g7 countries from 1948 to 1993 garch models are used to generate a measure of inflation uncertainty and then granger methods are employed to test the causality between average inflation and inflation uncertainty in all g7 countries inflation significantly raises inflation uncertainty as predicted by friedman and ball weaker evidence is found that inflation uncertainty granger causes inflation in three countries us uk and germany increased inflation uncertainty lowers inflation while in two countries japan and france increased inflation uncertainty raises inflation

nominal uncertainty and inflation the role of european union membership abstract we provide evidence that higher inflation uncertainty leads to higher inflation in the new european union eu member states and candidate countries only prior to eu accession during eu accession and entry inflation uncertainty has no effect on mean inflation

when higher incomes reduce welfare queues labor supply and macro equilibrium in socialist economies starting from a micro model of consumer behavior under rationing by queuing that utilizes gary becker s allocation of time framework we develop a simple macroeconomic model of a socialist economy the length of the queue is the key endogenous variable that equilibrates aggregate supply and aggregate demand comparative statics analysis shows that an increase in wages over money prices brings about longer queues that reduce labor supply output and welfare when shortages grow beyond a certain critical level queues fail to sustain aggregate equilibrium in the economy

the stochastic volatility in mean model with time varying parameters an application to inflation modeling this article generalizes the popular stochastic volatility in mean model to allow for time varying parameters in the conditional mean the estimation of this extension is nontrival since the volatility appears in both the conditional mean and the conditional variance and its coefficient in the former is time varying we develop an efficient markov chain monte carlo algorithm based on band and sparse matrix algorithms instead of the kalman filter to estimate this more general variant the methodology is illustrated with an application that involves u s u k and germany inflation the estimation results show substantial time variation in the coefficient associated with the volatility highlighting the empirical relevance of the proposed extension moreover in a pseudo out of sample forecasting exercise the proposed variant also forecasts better than various standard benchmarks

inflation and uncertainty tests for temporal ordering for the postwar united states increases in the rate of inflation tend to precede increases in the level of inflation uncertainty the finding suggests that higher inflation uncertainty is part of the welfare cost of inflation possible explanations are 1 a high rate of inflation increases uncertainty about future monetary policy and 2 there is uncertainty about the persistence of inflation copyright 1995 by ohio state university press

inflation and output growth uncertainty and their relationship with inflation and output growth abstract using a bivariate garch model of inflation and output growth we find evidence that higher inflation and more inflation uncertainty lead to lower output growth in the japanese economy these results support the argument of a price stability objective for the monetary authority