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Is inflation always and everywhere a monetary phenomenon?

de Grauwe, Paul and Polan, Magdalena (2005) Is inflation always and everywhere a monetary phenomenon? Scandinavian Journal of Economics, 107 (2). pp. 239-259. ISSN 0347-0520

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Identification Number: 10.1111/j.1467-9442.2005.00406.x


Using a sample of about 160 countries over the last 30 years, we test for the quantity theory relationship between money and inflation. When analysing the full sample of countries, we find a strong positive relation between long-run inflation and the money growth rate. The relation is not proportional, however. The strong link between inflation and money growth is almost wholly due to the presence of high-(or hyper-) inflation countries in the sample. The relationship between inflation and money growth for low-inflation countries (on average less than 10% per annum over the last 30 years) is weak.

Item Type: Article
Official URL:
Additional Information: © 2005 The editors of The Scandinavian Journal of Economics
Subjects: H Social Sciences > HB Economic Theory
Sets: Departments > European Institute
Collections > Economists Online
Date Deposited: 05 Oct 2012 11:09
Last Modified: 05 Oct 2012 11:09

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