DISINFLATIONS IN LATIN AMERICA AND THE CARIBBEAN: A FREE LUNCH?

Marc Hofstetter

No 2375, Documentos CEDE from Universidad de los Andes, Facultad de Economía, CEDE

Abstract: This paper challenges the conventional view according to which disinflations in Latin America -even from low and moderate peaks- have been carried out at no cost to output. After suggesting a new methodology that overcomes some of the shortcomings of the traditional methods used to measure the costs of disinflations, large sacrifice ratios are obtained for the 1970s and 80s. While the disinflation costs for the 90s remain negative, it is shown that an unusual combination of circumstances -i.e., factors related to capital inflows, structural reforms, and the peculiar recent inflation history- can explain this fortunate result.

Keywords: Inflation; Growth; Disinflation costs; Sacrifice Ratios; Latin America (search for similar items in EconPapers)
JEL-codes: E00 E31 E32 E52 F4 (search for similar items in EconPapers)
Pages: 27
Date: 2006-01-10
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
https://repositorio.uniandes.edu.co/bitstream/handle/1992/7978/dcede2006-04.pdf

Related works:
Journal Article: Disinflations in Latin America and the Caribbean: A free lunch? (2008)
Working Paper: Disinflations in Latin America and the Caribbean: A Free Lunch? (2004)
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:col:000089:002375

Access Statistics for this paper

More papers in Documentos CEDE from Universidad de los Andes, Facultad de Economía, CEDE Contact information at EDIRC.
Bibliographic data for series maintained by Universidad De Los Andes-Cede ().