Stopping High Inflation: An Analytical Overview

Carlos Vegh

MPRA Paper from University Library of Munich, Germany

Abstract: This paper reviews the evidence on stabilization plans in high inflation countries within a unified theoretical framework. The evidence suggests that hyperinflations have been stopped almost instantaneously with no major output costs, while stabilization programs in chronic inflation countries have resulted in an initial expansion followed by a later recession, in addition to a sustained real exchange rate appreciation and current account deficits. These outcomes turn out to be consistent with the predictions of the analytical model.

Keywords: inflation; stabilization (search for similar items in EconPapers)
JEL-codes: F41 (search for similar items in EconPapers)
Date: 1991-11
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Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:20175

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