Why Are Rates of Inflation So Low After large Devaluations

Martin Eichenbaum, Sergio Rebelo () and Ariel Burstein

No 3178, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: This Paper studies the behaviour of inflation after nine large post-1990 contractionary devaluations. A salient feature of the data is that inflation is low relative to the rate of devaluation. We argue that distribution costs and substitution away from imports to lower quality local goods can account quantitatively for the post-devaluation behaviour of prices.

Keywords: inflation; Devaluation; Exchange rates (search for similar items in EconPapers)
JEL-codes: F31 (search for similar items in EconPapers)
Date: 2002-01
New Economics Papers: this item is included in nep-ifn
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (79)

Downloads: (external link)
https://cepr.org/publications/DP3178 (application/pdf)

Related works:
Working Paper: Why Are Rates of Inflation So Low After Large Devaluations? (2002)
Working Paper: Why Are Rates of Inflation So Low After Large Devaluations? (2002)
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:cpr:ceprdp:3178

Ordering information: This working paper can be ordered from
https://cepr.org/publications/DP3178

Access Statistics for this paper

More papers in CEPR Discussion Papers from Centre for Economic Policy Research 33 Great Sutton Street, London EC1V 0DX, UK.
Bibliographic data for series maintained by CEPR ().