Artículo
Inflation targeting, disinflation, and debt traps in Argentina
Fecha de publicación:
04/2020
Editorial:
Edward Elgar Publishing Ltd.
Revista:
European Journal of Economics and Economic Policies: Intervention
ISSN:
2052-7764
e-ISSN:
2052-7772
Idioma:
Inglés
Tipo de recurso:
Artículo publicado
Clasificación temática:
Resumen
This paper highlights the role of external indebtedness and the presence of inflationary inertia in order to assess the effectiveness and sustainability of inflation targeting during disinflation episodes. As the recent Argentinian experience illustrates, a sluggish inflation rate and a significant currentaccount deficit may make the stabilization process difficult. To illustrate the point, we build a model that shows that, when inflation adjusts fast, the target may be achieved without building too much external debt. But if inflation adjusts slowly, an excessive build-up of external debt could lead to an increase in the risk premium, a sudden shortage of foreign exchange, and the eventual collapse of the inflation-targeting regime.
Palabras clave:
CHRONIC INFLATION
,
DEBT TRAPS
,
INFLATION TARGETING
,
LACK OF CREDIBILITY
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Articulos(SEDE CENTRAL)
Articulos de SEDE CENTRAL
Articulos de SEDE CENTRAL
Citación
Libman, Emiliano; Palazzo, Gabriel Martín; Inflation targeting, disinflation, and debt traps in Argentina; Edward Elgar Publishing Ltd.; European Journal of Economics and Economic Policies: Intervention; 17; 1; 4-2020; 78-105
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