One Hundred Inflation Shocks: Seven Stylized Facts

Anil Ari, Carlos Mulas-Granados, Victor Mylonas, Lev Ratnovski and Wei Zhao
Additional contact information
Anil Ari: International Monetary Fund
Carlos Mulas-Granados: International Monetary Fund
Lev Ratnovski: International Monetary Fund
Wei Zhao: Citi

International Journal of Central Banking, 2026, vol. 22, issue 1, 391-548

Abstract: This paper identifies over 100 inflation shock episodes in 56 countries since the 1970s, including over 60 episodes linked to the 1973–79 oil crises. We document that only in 60 percent of the episodes was inflation brought back down (or “resolved”) within five years, and that even in these “successful” cases resolving inflation took, on average, over three years. Success rates were lower and resolution times longer for episodes induced by terms-of-trade shocks during the 1973–79 oil crises. Most unresolved episodes involved “premature celebrations,” where inflation declined initially, only to plateau at an elevated level or reaccelerate. Countries that resolved inflation had tighter monetary policy that was maintained more consistently over time, lower nominal wage growth, and less currency depreciation, compared to unresolved cases. Successful disinflations were associated with short-term output losses, but not with larger output, employment, or real wage losses over a five-year horizon, potentially indicating the value of policy credibility and macroeconomic stability.

Date: 2026
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.ijcb.org/journal/v22n1/one-hundred-inf ... seven-stylized-facts (text/html)

Related works:
Working Paper: One Hundred Inflation Shocks: Seven Stylized Facts (2023)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ijc:ijcjou:y:2026:q:1:a:8

Access Statistics for this article

International Journal of Central Banking is currently edited by Loretta J. Mester

More articles in International Journal of Central Banking from International Journal of Central Banking
Bibliographic data for series maintained by Bank for International Settlements ().