IDEAS home Printed from https://ideas.repec.org/p/zbw/bofitp/bdp2004_005.html
   My bibliography  Save this paper

Observations on disinflation in transition economies

Author

Listed:
  • Wachtel, Paul
  • Korhonen, Iikka

Abstract

The transition economies were remarkably successful in curbing the inflation that took place after the initial transition and shocks and, more recently, most of the countries have brought inflation down to the levels found in major developed countries.In this paper we review the experiences and show how fiscal discipline, monetary policy and exchange rate policy contributed to the outcome.In addition, we note that the influence of EU accession on institutions and policy may have played an important role.The paper also surveys the literature on the quality of the inflation data, the extent to which necessary relative price adjustments have occurred and the size of the Balassa-Samuelson effect.Case studies of disinflation in four countries are presented: Poland, Romania, Estonia and Russia.

Suggested Citation

  • Wachtel, Paul & Korhonen, Iikka, 2004. "Observations on disinflation in transition economies," BOFIT Discussion Papers 5/2004, Bank of Finland Institute for Emerging Economies (BOFIT).
    • Handle: RePEc:zbw:bofitp:bdp2004_005
    as

    Download full text from publisher

    File URL: https://www.econstor.eu/bitstream/10419/212536/1/bofit-dp2004-005.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Erica L. Groshen & Mark E. Schweitzer, 1997. "Inflation goals: guidance from the labor market?," Current Issues in Economics and Finance, Federal Reserve Bank of New York, vol. 3(Dec).
    2. Filer, Randall K. & Hanousek, Jan, 2003. "Inflationary bias in middle to late transition Czech Republic," Economic Systems, Elsevier, vol. 27(4), pages 367-376, December.
    3. Begg, David, 1997. "Monetary Policy during Transition: Progress and Pitfalls in Central and Eastern Europe, 1990-6," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 13(2), pages 33-46, Summer.
    4. Ms. Paula De Masi & Mr. Vincent Koen, 1997. "Prices in the Transition: Ten Stylized Facts," IMF Working Papers 1997/158, International Monetary Fund.
    5. Mr. Philipp C Rother, 2000. "Inflation in Albania," IMF Working Papers 2000/207, International Monetary Fund.
    6. Nina Budina & Sweder Van Wijnbergen, 2001. "Fiscal deficits, monetary reform and inflation stabilization in romania," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 4(3), pages 165-194.
    7. Wozniak, Przemyslaw, 1998. "Relative prices and inflation in Poland, 1989-97 : the special role of administered price increases," Policy Research Working Paper Series 1879, The World Bank.
    8. Rodriguez-Palenzuela, Diego & Thimann, Christian & Backé, Peter, 2002. "Inflation dynamics and dual inflation in accession countries: a 'New Keynesian' perspective," Working Paper Series 132, European Central Bank.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. repec:zbw:bofitp:2004_005 is not listed on IDEAS
    2. Wachtel, Paul & Korhonen, Iikka, 2004. "Observations on disinflation in transition economies," BOFIT Discussion Papers 5/2004, Bank of Finland, Institute for Economies in Transition.
    3. Marek Dabrowski & Wojciech Paczynski & Lukasz Rawdanowicz, 2002. "Inflation and Monetary Policy in Russia: Transition Experience and Future Recommendations," CASE Network Studies and Analyses 0241, CASE-Center for Social and Economic Research.
    4. Jan Babecký & Fabrizio Coricelli & Roman Horváth, 2009. "Assessing Inflation Persistence: Micro Evidence on an Inflation Targeting Economy," Czech Journal of Economics and Finance (Finance a uver), Charles University Prague, Faculty of Social Sciences, vol. 59(2), pages 102-127, June.
    5. Mr. Bogdan Lissovolik, 2003. "Determinants of Inflation in a Transition Economy: The Case of Ukraine," IMF Working Papers 2003/126, International Monetary Fund.
    6. Jérôme Creel & Sandrine Levasseur, 2004. "How would a fixed-exchange-rate regime fit the transition economies?. The cases of the Czech Republic, Hungary and Poland," Revue de l'OFCE, Presses de Sciences-Po, vol. 91(5), pages 83-120.
    7. Kocenda, Evzen, 2005. "Beware of breaks in exchange rates: Evidence from European transition countries," Economic Systems, Elsevier, vol. 29(3), pages 307-324, September.
    8. Michal Pazour, 2006. "Dynamika konvergence cenové úrovně ČR a strategie přistoupení k eurozóně [Price level convergence dynamics in the CR and the accession strategy to the euro-zone]," Politická ekonomie, Prague University of Economics and Business, vol. 2006(6), pages 802-815.
    9. Nicoleta CIURILA & Bogdan MURARASU, 2008. "Inflation Dynamics in Romania – a New Keynesian Perspective," Annals of University of Craiova - Economic Sciences Series, University of Craiova, Faculty of Economics and Business Administration, vol. 1(36), pages 155-160, May.
    10. Fabrizio Coricelli & Boštjan Jazbec & Igor Masten, 2004. "L'influence du régime de change sur l'inflation dans les pays adhérents," Economie & Prévision, La Documentation Française, vol. 163(2), pages 51-61.
    11. Fabrizio CORICELLI & Bostjan JAZBEC & Igor MASTEN, 2004. "Exchange Rate Pass-Through in Acceding Countries: The Role of Exchange Rate Regimes," Economics Working Papers ECO2004/16, European University Institute.
    12. Dumitriu, Ramona & Stefanescu, Razvan, 2013. "Provocările politicii monetare [Monetary policy challenges]," MPRA Paper 50261, University Library of Munich, Germany, revised 28 Sep 2013.
    13. Jan Hanousek & Randall K. Filer, 2003. "Substitution Biases in Price Indexes during Transition," Development and Comp Systems 0306002, University Library of Munich, Germany.
    14. Pelipas, Igor, 2006. "Money demand and inflation in Belarus: Evidence from cointegrated VAR," Research in International Business and Finance, Elsevier, vol. 20(2), pages 200-214, June.
    15. Agnieszka Leszczynska & Aleksandra Halka, 2012. "What does the Consumer Price Index Measure? Bias Estimates for Poland," EcoMod2012 4370, EcoMod.
    16. Christian Dreger & Konstantin Kholodilin & Kirsten Lommatzsch & JiÅí SlaÄálek & Przemyslaw Wozniak, 2008. "Price Convergence in an Enlarged Internal Market," Eastern European Economics, Taylor & Francis Journals, vol. 46(5), pages 57-68, September.
    17. Fabrizio Coricelli & Bo??tjan Jazbec & Igor Masten, 2004. "Exchange Rate Policy and Inflation in Acceding Countries: The Role of Pass-through," William Davidson Institute Working Papers Series 2004-674, William Davidson Institute at the University of Michigan.
    18. D'Elia, Enrico, 2005. "Actual and perceived inflation," MPRA Paper 36018, University Library of Munich, Germany.
    19. Coricelli, Fabrizio & Jazbec, Boštjan & Masten, Igor, 2003. "Exchange Rate Pass-Through in Candidate Countries," CEPR Discussion Papers 3894, C.E.P.R. Discussion Papers.
    20. Felix Hammermann & Mark Flanagan, 2009. "What explains persistent inflation differentials across transition economies?1," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 17(2), pages 297-328, April.
    21. Hammermann, Felix & Flanagan, Mark, 2007. "What Explains Persistent Inflation Differentials Across Transition Economies?," Kiel Working Papers 1373, Kiel Institute for the World Economy (IfW Kiel).

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:zbw:bofitp:bdp2004_005. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ZBW - Leibniz Information Centre for Economics (email available below). General contact details of provider: https://edirc.repec.org/data/bofitfi.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.