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1.
Economic Affairs ; 42(2):288-306, 2022.
Article in English | ProQuest Central | ID: covidwho-1932437

ABSTRACT

For most of the period since China started to reform and open its economy, falling goods prices in developed economies have been offset by rising service prices, but as a result of the COVID‐19 pandemic these relative price trends have been temporarily reversed. Separately from these relative price changes, the 2021–22 episode of inflation reflects broad money growth rates in many economies around the world since the start of the pandemic. The economies that are predicted to experience the greatest increase in inflation are those where monetary growth has increased most relative to the requirements to finance normal economic growth and the normal increase in demand for money balances (the inverse of income velocity).

2.
VUZF Review ; 7(2):17-24, 2022.
Article in Bulgarian | ProQuest Central | ID: covidwho-1925019

ABSTRACT

The article describes the measures taken by the central banks of the world's largest economies to combat high inflation. The authors give a definition of what exactly is considered high inflation, analyze the timeliness and effectiveness of taking anti-inflationary measures, and also answer the question of the need for the monetary authorities to react to inflation, which does not have an obvious monetary nature. In the article the particular attention is paid to the difference between the anti-inflationary policy of central banks in developed and emerging markets, as well as to the issues of coordination between the actions of the central bank and the government in the field of anti-inflationary policy. The authors point out the importance of increasing the efficiency of the transmission mechanism through the development of various segments of the financial market, including the derivatives market. As a result of the study, a hypothesis is put forward that there is a direct relationship between the development of the financial market, especially the capital market, and the costs of fighting inflation. Countries with less developed capital markets and smaller gold and foreign exchange reserves are forced to use the key rate of central banks to fight inflation, paying with their economic growth potential for the opportunity to have low inflation. The article also makes a fundamental conclusion that the risk of inflation has acquired global features, however has not yet affected all countries, bypassing those markets that traditionally struggled with the deflation factor, and their central banks had negative rates. As well, the article pays attention to the dependence of the foreign exchange rate on the difference between the levels of interest rates, and makes assumptions about the possibility of manipulating the foreign exchange rate through delaying anti-inflationary measures in order to stimulate exports.

3.
Public Finance Quarterly ; 66(1):50-67, 2021.
Article in English | ProQuest Central | ID: covidwho-1836580

ABSTRACT

There is no uniform theoretical standpoint on the effects of changing interest rates and the role of money among economists. Though these disputes exercise a great influence on the economic policy measures adopted as well. For the management of the 2008 global financial crisis many central banks entered into forceful interest rate cuts to contribute to the revitalisation of the economy. The economic recession caused by the pandemic of 2020 again raises the issue how central banks can stimulate growth. In this study we deal with the liquidity trap issue attributed to Keynes. Keynes pointed out that there might exist a lower interest rate limit under which money demand becomes infinite. His conceptions put the foundations to the question, at what interest rate levels might the liquidity trap – a term coined later by Robertson – phenomenon become effective. He was followed by numerous renowned economists dealing with the conception. In this paper we are discussing the most important theoretical approaches – among others the views of Hansen, Hicks, Tobin, Patinkin, Krugman, Brunner and Meltzer and Eggertson. We provide an overview on the effects of low interest rate levels adopted by Japan, by the central banks of Japan, the USA and the ECB aimed at stimulating the economy. Based on the study it can be confirmed that central banks can contribute to economic growth keeping interest rates low and therewith fostering investment. Nevertheless, beyond keeping short-term interest rates low, it might be adequate to control interest rates of other maturities and, especially under deflationary expectations, central banks should express their prolonged commitment to low interest rates.

4.
European Journal of Economics and Economic Policies ; 18(3):331-331–343, 2021.
Article in English | ProQuest Central | ID: covidwho-1592495

ABSTRACT

For the last 40 years, macroeconomics has been dominated by Milton Friedman’s view that inflation occurs when the supply of money rises more quickly than economic output – ‘too much money chasing too few goods’, as the saying goes. If inflation is always due to an imbalance of money supply and output, central banks alone determine the path of inflation, and fiscal policy merely has a redistributive function. This paper draws on historical and empirical evidence as well as recent theoretical literature to show that this view is mistaken. Monetary policy has redistributive effects, and fiscal policy affects the money supply. It is therefore impossible to separate them in practice. Both fiscal and monetary policy have inflationary consequences, and because their distributional effects are different, monetary policy cannot fully offset fiscal decisions. Fiscal and monetary policy are influenced by political decisions and are themselves political in nature. Since inflation reflects spending and saving patterns which are affected by political choices, it is fundamentally a political phenomenon.

5.
Pulm Ther ; 7(2): 503-516, 2021 Dec.
Article in English | MEDLINE | ID: covidwho-1540322

ABSTRACT

INTRODUCTION: Lung hyperinflation in chronic obstructive pulmonary disease (COPD) is associated with activity limitation, impaired cardiac output, and mortality. Several studies have demonstrated that long-acting muscarinic antagonists (LAMAs) delivered by dry powder inhalers can promote lung deflation; however, the potential of nebulized LAMAs on improving hyperinflation in COPD is currently unknown. METHODS: This single-center, randomized, double-blind, two-way crossover study (NCT04155047) evaluated the efficacy of a single dose of nebulized LAMA [glycopyrrolate (GLY) 25 µg] versus placebo in patients with COPD and lung hyperinflation. Patients with moderate-to-severe COPD and a residual volume (RV) ≥ 130% of predicted normal were included. The primary endpoint was changed from baseline in RV at 6 h post-treatment. Other endpoints included changes from baseline in spirometric and plethysmographic measures up to 6 h post-treatment. RESULTS: A total of 22 patients (mean pre-bronchodilator RV, 153.7% of predicted normal) were included. The primary objective of the study was not met; the placebo-adjusted least squares (LS) mean [95% confidence interval (CI) change from baseline in RV with GLY at 6 h post-treatment was - 0.323 l (- 0.711 to 0.066); p = 0.0987]. A post hoc evaluation of the primary analysis was conducted after excluding a single statistical outlier; substantial improvements in RV with GLY compared with placebo was observed after exclusion of this outlier [placebo-adjusted LS mean change from baseline (95% CI) in RV was - 0.446 l (- 0.741 to - 0.150)]. Improvements from baseline were also observed with GLY compared with placebo in spirometric and plethysmographic measures up to 6 h post-treatment. GLY was generally safe, and no new safety signals were detected. CONCLUSIONS: This is the first study to evaluate the effect of nebulized GLY on lung deflation. Nebulized GLY resulted in marked improvements in RV up to 6 h post-treatment, compared with placebo. Improvements were also observed with GLY in spirometric and plethysmographic parameters of lung function. TRIAL REGISTRATION: ClinicalTrials.gov identifier, NCT04155047.

6.
SERIEs (Berl) ; 11(4): 561-583, 2020.
Article in English | MEDLINE | ID: covidwho-1241716

ABSTRACT

Oil price showed sharp fluctuations in recent years which revived the interest in its effect on inflation. In this paper, we discuss the relationship between oil price and inflation in Spain, at national and regional levels, and making the distinction between energy and non-energy inflation. To this end, we fit econometric models to measure the effect of oil price shocks on inflation and to predict them under different scenarios. Our results show that almost half of the volatility of changes in total inflation is explained by changes in oil price. As could be expected, the energy component of inflation drives this effect. We also find that, under the most likely scenarios, 1-year ahead total inflation will be moderate, with relevant differences across regions.

7.
Comp Econ Stud ; : 1-19, 2021 Apr 13.
Article in English | MEDLINE | ID: covidwho-1191468

ABSTRACT

The huge fiscal expansions triggered by the corona crisis raised debt/GDP ratios to very high levels. This led some economists to reconsider the taboo on seignorage. Following a brief documentation of the crisis impact and aggregate demand policies responses the paper discusses views of academics and policymakers on seignorage. Optimal taxation considerations imply that the decision on allocating deficit financing between debt and seignorage falls within the realm of fiscal authorities-a fact that infringes on central bank (CB) autonomy. The paper explores ideas aimed at improving the tradeoff between those two principles. Implication of cross-country variations in the need to use seignorage is discussed. Comparison of the indirect contribution of quantitative easing (QE) to deficit financing with the direct contribution of seignorage implies that QE is a substitute to seignorage that preserves central bank dominance without much change in existing monetary institutions. Comparison of empirical evidence from the USA during the global financial crisis with the post-WWI German inflation supports the view that for countries experiencing deflationary pressure seignorage is more potent in moving inflation toward its target than QE. Given the current outlook temporary use of seignorage does not appear to involve a substantial risk of inflation.

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