著者

RICHARD G. ZIND

出版者

JAPANESE ECONOMIC ASSOCIATION

雑誌

The Economic Studies Quarterly (ISSN:0557109X)

巻号頁・発行日

vol.44, no.2, pp.108-116, 1993-06-18 (Released:2007-10-19)

参考文献数

19

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We analyze in this study the relation between changes in the price level and in income growth in the LDCs. Based on the World Bank 1965-1980 growth rates data drawn from 66 LDCs, we found significant evidence of a positive causal relation between the money supply growth rate and the inflation rate and a negative causal relation between income growth and the inflation rate. We also found that the money supply growth rate impacted positively both the inflation rate and income growth. The effect of this increase on income depends on the response of economic agents to the price increases. Our estimates, based on Summers and Heston data, agree with a basic postulate of the Lucas model: there is a significant weakening of the response as the variance of the nominal income growth rate increases. Finally, we found that prices have tended to converge among nation over the past two decades.