Inflation and relative price variability in Venezuela

José Contreras () and Nora Guarata ()
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José Contreras: Oficina de Investigaciones Económicas, Banco Central de Venezuela. Carmelitas Caracas, Venezuela.
Nora Guarata: Oficina de Investigaciones Económicas, Banco Central de Venezuela. Carmelitas Caracas, Venezuela.

Economía, 2013, vol. 38, issue 36, 85-122

Abstract: There are several theories about the causes of inflation but none of them is capable of explaining the phenomenon in all cases. We started with an overview of the main theories. In the particular case of Venezuela, it seems that the inflationary phenomenon responds to structural factors rather than circumstantial ones. We utilized three variables that measure relative price distribution and tested for their relation with inflation. Later we used a modified Phillips curve, which included exchange rate as an explanatory variable and regressed it with and without the variables relating relative price distribution: variance, skewness and a combination of both. We concluded that those variables helped explain inflation in Venezuela for the period we studied.

Keywords: Inflation; Phillips curve; relative price distribution. (search for similar items in EconPapers)
JEL-codes: C12 C22 E31 (search for similar items in EconPapers)
Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:ula:econom:v:38:y:2013:i:36:p:85-122

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