DP19 The Costs of Inflation: Some Theoretical Issues
|Author(s):||John Hardman Moore|
|Publication Date:||May 1984|
|Keyword(s):||Indexation of Loans, Inflation, Stock Market|
|JEL(s):||134, 313, 315|
|Programme Areas:||Applied Macroeconomics|
|Link to this Page:||cepr.org/active/publications/discussion_papers/dp.php?dpno=19|
Although for the most part this paper is concerned with others' work, it is not a survey of the literature. Notable omissions are: the shoe-leather effect, the Tobin effect, the real effects of nominal (government) institutions. The first part looks at the relationship between inflation, relative prices and inefficiency. Inter alia, there is a critique of the way the price misperceptions model has been used in applied work, and a new model of the effects of consumers thinking in nominal terms. The second part considers the consequences of, and possible reasons for, the non-indexing of loans. Finally, the relation between inflation and the stock market is discussed.