StudentShare solutions
Triangle menu

Macroeconomics (inflation) - Essay Example

Nobody downloaded yet

Extract of sample
Macroeconomics (inflation)

The inference is not necessarily correct: other explanations are equally logical and sufficiently important to be worth serious consideration. Many countries might experience inflation at the same time without international transmission of inflationary forces because they respond in the same way to common causes (Wickens 54). All countries have undergone long-period institutional and structural changes which, although not in themselves inflationary, have made them more vulnerable to inflation. One of these changes is a widespread increase in the resistance to reductions of nominal prices and wages. Another is the growing role of the public sector in most national economies, a development that may increase the vulnerability to inflation in a number of different ways, which are discussed in the appendix to this paper. Another possible cause of a decrease in the dispersion of rates of change in consumer prices and other comprehensive price indexes, such as gross national product deflators, is a convergence in the rates of productivity growth of different countries. These comprehensive price indexes tend to diverge from the corresponding national indexes of wholesale prices in degrees related to the growth in a country's productivity. If changes in national wholesale prices continue to be tied together, a convergence of national rates of productivity growth would cause a convergence of changes in their consumer price indexes and GNP deflators (Wickens 51).
Gali (2008) underlines that monetary changes may directly release inflationary forces. In the monetary field, the development and expansion of the Eurocurrency market, even if it has not greatly increased the supply of what one chooses to call "money," has increased the supply of liquidity or reduced the demand for it. Similarly, the establishment of special drawing rights has provided a non-national addition to the international reserve assets of the recipient countries without increasing the liabilities of other countries. Other explanations of a decrease in dispersion of inflation rates are also possible. For example, inflation rates may have been generated in many countries at the same time merely because cyclical expansion in a number of important countries coincided to an unusual degree (Gali 77). Although the probability that such similarity of movement in several large countries occurred by sheer coincidence may not be high, it is not so low as to be negligible; such synchronization has occurred at times in the past when the world economy is widely regarded as having been less integrated than it is now, and it occurred then to a greater extent than in some subsequent periods, as is indicated by the evidence cited in the appendix (Gali 72).
As national inflation rates may converge without increased international transmission through market forces, so may such transmission increase without making inflation rates converge. Indeed, an increase in such transmission may even increase the dispersion of some measures of inflation. This may be more than a possibility with regard to dispersion of consumer price in ...Show more
Cite this document
  • APA
  • MLA
(“Macroeconomics (inflation) Essay Example | Topics and Well Written Essays - 1500 words”, n.d.)
Retrieved from
(Macroeconomics (inflation) Essay Example | Topics and Well Written Essays - 1500 Words)
“Macroeconomics (inflation) Essay Example | Topics and Well Written Essays - 1500 Words”, n.d.
  • Cited: 0 times


In macroeconomics, inflation is one of the main and most complicated issues. The widespread issue of the inflation and of its acceleration, and especially the reduction in its dispersion, has led to a rather general acceptance of the view that it is being transmitted among countries to a greater extent than before, to expositions of various possible mechanisms of transmission, and to econometric testing of the relative importance of these mechanisms…
Macroeconomics (inflation)
Read Text Preview
Save Your Time for More Important Things
Let us write or edit the essay on your topic
"Macroeconomics (inflation)"
with a personal 20% discount.
Grab the best paper

Check these samples - they also fit your topic

Inflation.What are the costs of inflation Are there any benefits to inflation
Some economies have experienced significant economic growth over time but inflation has sometimes been a problem.It is one of the twin problems resulting from the alternating rises and declines in the level of economic activity or also known as the business cycle that causes macroeconomic instability. Inflation is a rise in the general level of prices
6 pages (1500 words) Essay
In effect, inflation is the loss or the diminishing of value of money in a given economy (Blanchard 45). In plain language, inflation is the instance where goods and services get expensive or the phenomena where people complain that the price of commodities is rising.
3 pages (750 words) Essay
Dynamic Macroeconomics. Discretionary monetary policy and inflation-targeting regime
Monetary policy has thus become in technical term the economic’s nominal anchor. The monetary policy regime was modified with the objective of escalating its underlying effectiveness and corresponding transparency in the face of the alterations by the Mexico’s economy.
6 pages (1500 words) Essay
Macroeconomics of the UK
Most of all the paper will detail the importance of interest rate ceiling initiated by the Bank of England to control and promote a healthy economy. It will analyze the trend in the interest rate and correlate the same with growth and point out areas of weakness or areas, which affect the economy as a whole and recommend and interest rate to the bank, which can be implemented for the rest of the year 2008.
8 pages (2000 words) Essay
Economics Coursework - Macroeconomics, Unemployment and Inflation
Zimbabwe is a country located in the borders of South Africa. In this country the economic is facing a disastrous hyperinflation
4 pages (1000 words) Essay
Macroeconomics II
It will analyze the trend in the interest rate and correlate the same with growth and point out areas of weakness or areas, which
6 pages (1500 words) Essay
Macroeconomics - housing and inflation
Although inflation occurs regularly in the economic system, it becomes a matter of concern when it reaches at higher levels. The rate of inflation provides the measure of price changes which occur for many goods and services. When it comes to individual goods, the changes
5 pages (1250 words) Essay
effect that it will now require more units of money for the same goods and services purchased or the number of goods and services purchased with the same amount of money is reduced. In effect, inflation is the loss or the diminishing of value of money in a given economy
4 pages (1000 words) Essay
This discussion concludes by outlining control measures necessary to manage inflation and the alternatives polices that can be taken by the government to manage inflation. Inflation refers to increment of price levels in
7 pages (1750 words) Essay
Inflation refers to increment of price levels in general that is the rise in prices in not on individual commodities but in all areas over a period of time. It’s a change expressed in percentage and compared over
7 pages (1750 words) Essay
Comments (0)
Click to create a comment
Let us find you another Essay on topic Macroeconomics (inflation) for FREE!
Contact us:
Contact Us Now
FREE Mobile Apps:
  • About StudentShare
  • Testimonials
  • FAQ
  • Blog
  • Free Essays
  • New Essays
  • Essays
  • The Newest Essay Topics
  • Index samples by all dates
Join us:
Contact Us