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• W2034648518 abstract "This paper analyzes the effects of inflation variability on economic growth in a model where money is introduced via a cash-in-advance constraint. In this setting, we find that inflation adversely affects long-run growth, even when the cash-in-advance constraint applies only to consumption. At the same time, we find that inflation and growth are positively related in the short run. Furthermore, variability increases average growth through a precautionary savings motive. Since inflation and inflation variability tend to be highly correlated, the presence of uncertainty attenuates the negative long-run relationship between inflation and real growth. It also provides a partial rationale for the apparent lack of robustness in cross-country regressions of growth and inflation." @default.
• W2034648518 created "2016-06-24" @default.
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• W2034648518 date "2000-06-01" @default.
• W2034648518 modified "2023-10-11" @default.
• W2034648518 title "Inflation uncertainty and growth in a cash-in-advance economy" @default.
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• W2034648518 doi "https://doi.org/10.1016/s0304-3932(00)00005-2" @default.
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