Inflation Dynamics in Madagascar, 1971-2000
Electronic Access:
Free Download. Use the free Adobe Acrobat Reader to view this PDF file
Summary:
The paper analyzes the dynamics of inflation in Madagascar in the period 1971-2000, applying cointegration analysis and error correction modeling. The empirical results, based on quarterly data, confirm that there exists a stable money demand relationship, as well as a purchasing power relationship in the long run. The former enters the short-run dynamics of inflation and money growth, while the latter affects the short-run dynamics of the exchange rate only. We also find that an appreciation has a direct negative impact on inflation and that inflation inertia is important. In addition, we conduct FIML estimation of the system and trace the impulse responses to various shocks.
Series:
Working Paper No. 2001/168
Subject:
Demand for money Exchange rate adjustments Exchange rates Foreign exchange Inflation Monetary base Money Prices
English
Publication Date:
October 1, 2001
ISBN/ISSN:
9781451858266/1018-5941
Stock No:
WPIEA1682001
Pages:
27
Please address any questions about this title to publications@imf.org