Unconventional Monetary Policy and Inflation in the U.S.: How Much Inflation was Missing?
The U.S. inflation rate for the period 2008-2016 was abnormally low despite the execution of a high expansive monetary policy, which has been called “the missing inflation paradox”. In this paper we estimate the missing inflation as the difference between the inflation predicted, and the observed ra...
- Autores:
-
Posada Posada, Carlos Esteban
Torres García, Alejandro
Villca Condori, Alfredo
- Tipo de recurso:
- Fecha de publicación:
- 2020
- Institución:
- Universidad EAFIT
- Repositorio:
- Repositorio EAFIT
- Idioma:
- eng
- OAI Identifier:
- oai:repository.eafit.edu.co:10784/15916
- Acceso en línea:
- http://hdl.handle.net/10784/15916
- Palabra clave:
- inflation
missing inflation
monetary policy
money demand
- Rights
- License
- Acceso abierto
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Medellín de: Lat: 06 15 00 N degrees minutes Lat: 6.2500 decimal degrees Long: 075 36 00 W degrees minutes Long: -75.6000 decimal degrees2020-03-13T16:24:41Z2020-03-122020-03-13T16:24:41Zhttp://hdl.handle.net/10784/15916C51E31E51E52E41The U.S. inflation rate for the period 2008-2016 was abnormally low despite the execution of a high expansive monetary policy, which has been called “the missing inflation paradox”. In this paper we estimate the missing inflation as the difference between the inflation predicted, and the observed rate using two monetarist models. The results support the adequacy of this approach to explain the inflation during 1970-2005. However, after that, the estimated missing inflation was around 3.5%-3.9% annually on average. Interestingly, this phenomenon apparently starts in 2006, previous to the beginning of the Great Recession. Although we do not present a formal explanation, the models used allow us to suspect the existence of an unusually high (and transitory) increase in the demand for real money balances.engUniversidad EAFITEscuela de Economía y FinanzasUnconventional Monetary Policy and Inflation in the U.S.: How Much Inflation was Missing?workingPaperinfo:eu-repo/semantics/workingPaperDocumento de trabajo de investigacióndrafthttp://purl.org/coar/version/c_b1a7d7d4d402bccehttp://purl.org/coar/resource_type/c_8042Acceso abiertohttp://purl.org/coar/access_right/c_abf2inflationmissing inflationmonetary policymoney demandcposad25@eafit.edu.coatorres7@eafit.edu.coavillcac@eafit.edu.coPosada Posada, Carlos EstebanTorres García, AlejandroVillca Condori, AlfredoLICENSElicense.txtlicense.txttext/plain; charset=utf-82556https://repository.eafit.edu.co/bitstreams/38d5319b-4d57-4b75-9ee0-5a727ab8001e/download76025f86b095439b7ac65b367055d40cMD51ORIGINALWP-2020-11_Carlos Esteban Posada.pdfWP-2020-11_Carlos Esteban Posada.pdfapplication/pdf1293060https://repository.eafit.edu.co/bitstreams/335d7559-40bd-454a-a3d6-dba2213ec460/downloadf5032d3cdb357e3ba8eb061cf2881fb4MD5210784/15916oai:repository.eafit.edu.co:10784/159162024-03-05 14:06:03.975open.accesshttps://repository.eafit.edu.coRepositorio Institucional Universidad EAFITrepositorio@eafit.edu.co |
| dc.title.eng.fl_str_mv |
Unconventional Monetary Policy and Inflation in the U.S.: How Much Inflation was Missing? |
| title |
Unconventional Monetary Policy and Inflation in the U.S.: How Much Inflation was Missing? |
| spellingShingle |
Unconventional Monetary Policy and Inflation in the U.S.: How Much Inflation was Missing? inflation missing inflation monetary policy money demand |
| title_short |
Unconventional Monetary Policy and Inflation in the U.S.: How Much Inflation was Missing? |
| title_full |
Unconventional Monetary Policy and Inflation in the U.S.: How Much Inflation was Missing? |
| title_fullStr |
Unconventional Monetary Policy and Inflation in the U.S.: How Much Inflation was Missing? |
| title_full_unstemmed |
Unconventional Monetary Policy and Inflation in the U.S.: How Much Inflation was Missing? |
| title_sort |
Unconventional Monetary Policy and Inflation in the U.S.: How Much Inflation was Missing? |
| dc.creator.fl_str_mv |
Posada Posada, Carlos Esteban Torres García, Alejandro Villca Condori, Alfredo |
| dc.contributor.eafitauthor.none.fl_str_mv |
cposad25@eafit.edu.co atorres7@eafit.edu.co avillcac@eafit.edu.co |
| dc.contributor.author.none.fl_str_mv |
Posada Posada, Carlos Esteban Torres García, Alejandro Villca Condori, Alfredo |
| dc.subject.keyword.spa.fl_str_mv |
inflation missing inflation monetary policy money demand |
| topic |
inflation missing inflation monetary policy money demand |
| description |
The U.S. inflation rate for the period 2008-2016 was abnormally low despite the execution of a high expansive monetary policy, which has been called “the missing inflation paradox”. In this paper we estimate the missing inflation as the difference between the inflation predicted, and the observed rate using two monetarist models. The results support the adequacy of this approach to explain the inflation during 1970-2005. However, after that, the estimated missing inflation was around 3.5%-3.9% annually on average. Interestingly, this phenomenon apparently starts in 2006, previous to the beginning of the Great Recession. Although we do not present a formal explanation, the models used allow us to suspect the existence of an unusually high (and transitory) increase in the demand for real money balances. |
| publishDate |
2020 |
| dc.date.available.none.fl_str_mv |
2020-03-13T16:24:41Z |
| dc.date.issued.none.fl_str_mv |
2020-03-12 |
| dc.date.accessioned.none.fl_str_mv |
2020-03-13T16:24:41Z |
| dc.type.eng.fl_str_mv |
workingPaper info:eu-repo/semantics/workingPaper |
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http://purl.org/coar/version/c_b1a7d7d4d402bcce |
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http://purl.org/coar/resource_type/c_8042 |
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Documento de trabajo de investigación |
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draft |
| dc.identifier.uri.none.fl_str_mv |
http://hdl.handle.net/10784/15916 |
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C51 E31 E51 E52 E41 |
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http://hdl.handle.net/10784/15916 |
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C51 E31 E51 E52 E41 |
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eng |
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eng |
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http://purl.org/coar/access_right/c_abf2 |
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Acceso abierto |
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Acceso abierto http://purl.org/coar/access_right/c_abf2 |
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Medellín de: Lat: 06 15 00 N degrees minutes Lat: 6.2500 decimal degrees Long: 075 36 00 W degrees minutes Long: -75.6000 decimal degrees |
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Universidad EAFIT |
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Escuela de Economía y Finanzas |
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Universidad EAFIT |
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