Price Liberalization, Money Growth, and Inflation During the Transition to a Market Economy
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Summary:
This paper examines the influence of economic liberalization and monetary growth on inflation during the transition from central plan to market. It concludes that price decontrol had a substantial, one-time effect on the price level but no lasting effect on inflation; that economic liberalization broadly defined may have helped dampen price increases; and that monetary expansion has been the fundamental determinant of inflation in the region. The paper also finds that the intensity of liberalization has been related to geographic proximity to market economies, to the size of the underground economy, and to the degree of political freedom.
Series:
Working Paper No. 1999/076
Subject:
Consumer prices Conventional peg Foreign exchange Inflation Monetary expansion Monetary policy Price controls Prices
English
Publication Date:
June 1, 1999
ISBN/ISSN:
9781451849851/1018-5941
Stock No:
WPIEA0761999
Pages:
24
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