Inflation, factor substitution and growth
- Recent empirical studies on the inflation-growth-relationship underline that inflation has negative growth effects already under relatively modest rates. Most contributions to monetary growth theory, however, have difficulties in explaining such a pattern. It is shown in this paper that this problem can be overcome by establishing a link between monetary instability and the aggregate elasticity of factor substitution. Several microeconomic justifications can be found for a negative influence of inflation on factor substitution. It turns out that already in a simple neoclassical monetary growth model this effect is usually strong enough to question the superneutrality benchmark result in the steady state and to dominate all potential positive effects of inflation along the convergence path. In a more general perspective the paper contributes to a better integration of institutional change in aggregate models of economic growth.
| Verfasserangaben: | Rainer KlumpORCiDGND |
|---|---|
| URN: | urn:nbn:de:hebis:30:3-333231 |
| URL: | http://ssrn.com/abstract=487420 |
| ISSN: | 1725-2806 |
| Titel des übergeordneten Werkes (Deutsch): | European Central Bank: Working paper series ; No. 280 |
| Schriftenreihe (Bandnummer): | European Central Bank: Working paper series (280) |
| Verlag: | Europ. Central Bank |
| Verlagsort: | Frankfurt am Main |
| Dokumentart: | Arbeitspapier |
| Sprache: | Englisch |
| Jahr der Fertigstellung: | 2003 |
| Jahr der Erstveröffentlichung: | 2003 |
| Veröffentlichende Institution: | Universitätsbibliothek Johann Christian Senckenberg |
| Datum der Freischaltung: | 20.03.2014 |
| Freies Schlagwort / Tag: | CES production functions; Monetary growth models; convergence; inflation; neo-classical growth |
| GND-Schlagwort: | Monetäre Wachstumstheorie; Inflation; CES-Funktion; Neoklassische Theorie; Aufholprozess; Nachholende Entwicklung |
| Seitenzahl: | 45 S. |
| Bemerkung: | © European Central Bank, 2003. Reproduction for educational and non-commercial purposes is permitted provided that the source is acknowledged. The views expressed in this paper do not necessarily reflect those of the European Central Bank. |
| HeBIS-PPN: | 347238157 |
| Institute: | Wirtschaftswissenschaften / Wirtschaftswissenschaften |
| DDC-Klassifikation: | 3 Sozialwissenschaften / 33 Wirtschaft / 330 Wirtschaft |
| Sammlungen: | Universitätspublikationen |
| Lizenz (Deutsch): |  Deutsches Urheberrecht |
