巴罗宏观经济学：现代观点第11章.pptVIP

Macroeconomics Chapter 11 Cross-Country Data on Inflation and Money Growth Key equation: Ms = P· L(Y, i) Two possible reasons of inflation: Decrease of real demand for money Increase of money supply Cross-Country Data on Inflation and Money Growth Inflation rates and money growth rates for 82 countries from 1960 to 2000. We measure the price level, P, by the consumer price index (CPI). We use the CPI, rather than the GDP deflator, because of data availability. Cross-Country Data on Inflation and Money Growth Highlights The inflation rate was greater than 0 for all countries from 1960 to 2000 The growth rate of nominal currency was greater than 0 for all countries from 1960 to 2000. There is a broad cross-sectional range for the inflation rates and the growth rates of money. Cross-Country Data on Inflation and Money Growth Highlights The median inflation rate from 1960 to 2000 was 8.3% per year, with 30 countries exceeding 10%. For the growth rate of nominal currency, the median was 11.6% per year, with 50 above 10% Cross-Country Data on Inflation and Money Growth Highlights In most countries, the growth rate of nominal currency, M, exceeded the growth rate of prices. For a country that has a high inflation rate in one period to have a high inflation rate in another period. Strong positive association between the inflation rate and the growth rate of nominal currency. Cross-Country Data on Inflation and Money Growth Cross-Country Data on Inflation and Money Growth One lesson from the cross-country data is that, to understand inflation, we have to include money growth as a central part of the analysis. Milton Friedman’s famous dictum: “Inflation is always and everywhere a monetary phenomenon.” Inflation and Interest Rates Actual and Expected Inflation Let π be the inflation rate. The inflation rate from year 1 to year 2, π1, is the ratio of the change in the price level to the initial price level. π1 = ( P2 ? P1)/ P1 π1 = ?P1/ P1 Inflation and Inter