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Sustained inflation in response to price liberalization

Author

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  • Conway, Patrick

Abstract

The author demonstrates that sustained inflation is a predictable response to price liberalization in the countries of the former Soviet Union. The author models the phenomenon in a dynamic macroeconomic framework,and demonstrates the immediate price jump followed by sustained inflation that has characterized the transitional economies of the former Soviet Union. The author supports the theoretical derivation with a simulation exercise that demonstrates the scope of sustained inflation for specific parameters.

Suggested Citation

  • Conway, Patrick, 1994. "Sustained inflation in response to price liberalization," Policy Research Working Paper Series 1368, The World Bank.
  • Handle: RePEc:wbk:wbrwps:1368
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    References listed on IDEAS

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