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7
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2answers
48 views

Why did large denomiations exist in the early 20th century?

In the early 1900s, you could buy a newspaper for 5 cents, a pound of apples for 10 cents and the average salary was about \$40 a month. Nowadays, an issue of the NYT costs \$2.50 , a pound of apples ...
1
vote
1answer
15 views

How does inflation in income go 'hand in hand with inflation in prices'?

Source: p 594, Economics, 3 Ed, 2014, by N G Mankiw, M P Taylor Yet further thought reveals a fallacy in this answer. When prices rise, buyers of goods and services pay more for what they buy. ...
3
votes
1answer
39 views

Why is the Argentine Peso still so expensive?

In the last twelve months, the argentine peso (ARS) lost about 11% of its value in comparison to USD. In the same time range the prices rouse about 29% (spanish). What's the reason for this effect? ...
4
votes
2answers
49 views

Quantitative Easing in Africa

I am currently doing a research work on quantitative easing and can't find any example in Africa. Do you know of any African central bank that has ever used QE? Thanks for your help and sorry for the ...
2
votes
1answer
31 views

Changing the base year of Real GDP from 2001 Euros to 1990 Geary–Khamis dollars

Estimating regional Gdp in Italy (1871-2001): sources, methodology, and results (Felice, E) This article has Italian historical regional GDP figures, but they are in constant 2001 euros not in 1990 ...
4
votes
2answers
73 views

Would a major wealth redistribution cause a major inflation?

I've seen a video on wealth distribution on the US where perceived, "desired"(by the majority) and actual income distributions are shown. I've been thinking what would happen to the purchasing power ...
2
votes
1answer
25 views

If a GDP deflator is continually greater than 100%, does that mean inflation is still occuring?

If a GDP deflator is continually greater than 100%, does that mean inflation is still occuring? If the difference in deflators from year to year is continually greater than 1%, does that mean ...
1
vote
0answers
81 views

Supply-side economics: reduction in tax

In a nutshell Supply-side economists support reductions in tax, because government revenue can increase (according to the Laffer curve) and businesses and consumers will be incentivised to invest ...
1
vote
0answers
20 views

Equal Payment Series

The question is: A man is planning to retire in 20 years. Money can be deposited at 8%, compounded monthly. It is estimated that the future general inflation rate will be 3% compounded annually. What ...
3
votes
2answers
144 views

Why aren't house prices included in CPI?

Swedens central bank recently lowered their prime rate to -0.25% from -0.10% in an effort to avoid deflation. At the same time, house and apartment prices are higher than ever, up 11% last 12 ...
3
votes
1answer
53 views

Old Measure of Inflation Still Tracked?

At this ZH link (paranoid blogger warning), the free documentary mentions that using an old measure of inflation, which was used during Paul Volcker's years at the Fed, inflation has been much higher ...
0
votes
2answers
70 views

Why do central banks increase their rate to fight inflation?

It was top news a week ago that Bank of Ukraine increased its rate to 30%. And the news said they did this to fight inflation. But I don't understand one thing: isn't the increased rate of "money ...
0
votes
1answer
41 views

Effects of an expected increase in the inflation rate on the market for loanable funds

I am supposed to answer a question in my economics class and was wondering if someone could explain it out for me. The question is, ...
3
votes
1answer
22 views

Does the amount of inward investments affect inflation?

I understand that inflation has an impact on the foreign direct investment. But can the opposite be true? The amount of foreign direct investment has an impact on the inflation of the country that ...
3
votes
1answer
45 views

What effect would raising reserve requirements while printing money have?

It is generally accepted, that printing money will be inflationary, as it increases the money supply without a corresponding real growth of the economy. At the same time, if the central bank ...
1
vote
2answers
35 views

Real value of debt

The Wikipedia article for real value says In economics, a nominal value is an economic value expressed in historical nominal monetary terms. By contrast, a real value is a value that has been ...
2
votes
0answers
26 views

Using the CPI to inflate real estate prices

I got my hands on an interesting dataset of property transfers covering four decades and I'm unsure of how to properly inflate prior-year sale prices. I typically use the 'bushel basket' metro CPI-U ...
4
votes
2answers
153 views

Inflation and economic growth

Noticeable works about the impact of inflation on economic growth are dated back to the 90s. For example, Barro (1995): the impact effects from an increase in average inflation by 10 percentage ...
2
votes
1answer
16 views

Can I use percentage change in CPI to calculate fare rate schedule?

There was a recent rollback in the fare rate in our city from 9.50 pesos to 6.50 pesos because of the decrease in the price of gasoline. The fare rate here is pegged to the prevailing price of ...
2
votes
1answer
41 views

Would it be correct to use exchange rates of the biggest trading partners to the dollar as an explanatory variable?

I'm trying to study the relationship of general macro factors and their effect on credit in the private sector. The country in question has a fixed exchange regime with the dollar, would it be ...
3
votes
3answers
222 views

Does Inflation Make Money Eventually Worthless?

I used this calculator: http://www.buyupside.com/calculators/inflationjan08.htm to estimate the future worth of 100 dollars in 100 years at 2% inflation. Does this really mean that a decent meal at a ...
6
votes
3answers
330 views

How does inflation impact the welfare of the economy?

When the government causes inflation through printing money, the individuals who saved their money in the bank are poorer. Is there a way to determine how different inflation rates impact the welfare ...
7
votes
1answer
66 views

Models for inflation prediction

I am looking for some statistical models that are accepted to best predict inflation rates. Anything that is more complicated than linear model will be appreciated. Or even recommend books that ...
1
vote
1answer
53 views

Central Banks and Price Stability

Are there any empirical studies on the question of whether independent central banks cause price stability? I am seeking to understand if independence (of the central monitory authority) is part of ...
7
votes
3answers
382 views

The reasons why rouble is collapsing

What can you people say about the reasons why rouble is collapsing? Which one is the main?
4
votes
1answer
43 views

Has any country attempted to inflation adjust capital gains before taxation?

Inspired by the answer to a different question I wondered: Can anyone think of a case study example, past or present, when capital gains are inflating adjusted before being taxed. I could imagine ...
5
votes
3answers
91 views

Is foreign-financed Basic Income Guarantee inflationary?

The question came up on comments in Politics.SE: Situation: A government of a country sets up an unconditional Basic Income Guarantee (defined as monthly payments to EVERY resident, ...
4
votes
2answers
85 views

Inflation, cause or result of monetary emission?

The argentine economist Fernanda Vallejos, while trying to protect the government because of the inflation, the following: Inflation is not the result but the cause of monetary emission. As ...
1
vote
2answers
127 views

Inflation reasons beyond Friedman

I think everyone know this Friedman quote nowadays: Inflation is always and everywhere a monetary phenomenon in the sense that it is and can be produced only by a more rapid increase in the ...
11
votes
4answers
217 views

From an economics perspective, what are the ramifications of a currency with fixed money supply?

I'm thinking specifically of bitcoins. What are the pros and cons of having a fixed number of coins, as opposed to more "normal" currencies? Would the currency have no inflation?
2
votes
5answers
239 views

Why isn't there an “ideal value” for a given currency? [closed]

If a currency can be worth too little (e.g. needing \$10,000,000,000 to buy a loaf of bread) and worth too much (e.g. being able to buy a loaf of bread for $0.00001), why isn't there an "ideal value" ...