Empirical literature examining the determinants of...

Empirical literature examining the determinants of inflation has mostly viewed it as a monetary phenomenon. This viewpoint basically stems from Milton Friedman’s famous dictum that inflation is always and everywhere a monetary phenomenon. However, the conjecture of Friedman has recently come under attack. In fact, there appears to be virtually no correlation between money growth and inflation since the early 1980s. This leads to evolution of the argument known as Fiscal Theory of Price Level (FTPL). To capture the nonmonetary aspects of inflation, a number of economists investigate the main political, institutional and economic determinants of inflation across countries and over time. For instance, Aisen and Veiga (2006) conclude that†¦show more content†¦With both the models they establish they confirm that higher inflation is associated with higher degree of political instability. The higher inflation is actually stemming from the budgetary policies of the fiscal au thorities. They validate their finding through the theory of political instability and deficit bias, arguing that changing governments give rise to excessively high budget deficit either because they are unaware of each others’ preferences or because they are in conflict on how to allocate the public spending. The greater the likelihood of a government change the more unstable is the political system and stronger would be the deficit bias. Another interpretation of the increasing budget deficit rests on the phenomenon of â€Å"war of attrition† between conflicting political groups. Sometimes higher number of political parties in a legislative system makes it difficult to reach agreements and hence raises the likelihood of conflict among political groups. For instance, although it would be ideal to stabilize the budget deficit, the conflict among the various political parties may not let them reach a consensus. As a result of the persistence of the deficit, government t urns to seignorage as the last resort to restore balance in fiscal budget which eventually causes inflation. Hence Khan andShow MoreRelatedThe Effect of Macro Economic Policy on Nigerian Economics Growth and Development6051 Words   |  25 PagesTHE EFFECT OF MACRO ECONOMIC POLICY ON NIGERIAN ECONOMICS GROWTH AND DEVELOPMENT ABSTRACT This research work focus on the appraisal of Macroeconomic Policy on Inflation in Nigerian Economy, also to determine how it enhances the growth of Nigerian Economy. The aim of this research work is to look into challenges and numbers of hypothesis were drawn. Information necessary to address the test of hypothesis was gathered through secondary data, source from Central Bank of Nigeria (CBN). Economic analysisRead MoreMerger and Acquisition: Current Issues115629 Words   |  463 PagesGlobal View Karyn L. Neuhauser 1 2 What Drives Acquisitions? A Market-Manager Rationality Framework Antonios Antoniou and Huainan Zhao 2.1 2.2 2.3 2.4 2.5 2.6 Introduction Hypothesis development Data and descriptive statistics Methodology Empirical results Conclusion 5 5 7 8 10 11 24 3 Misadventure and the Form of Payment in Corporate Acquisitions Tyrone M. Carlin, Guy Ford and Nigel Finch 3.1 Introduction 3.2 Factors influencing the form of consideration in acquisitions 3.3 A priceRead MoreEffect of Internal Controls on Financial Performance11978 Words   |  48 Pagesengagements have to become a dynamic and integral part of the market economy. The identification of factors that determine new venture performance such as survival, growth or profitability has been one of the most central fields of entrepreneurship research (Sarasvathy, 2004). A multitude of research papers has focused on exploring various variables and their impact on performance (Bamford et al., 2004). However, in order to be able to analyze and model the performance of new ventures and SMEs, theRead MoreIntangible Asset Accounting and Accounting Policy Selection in the Football Industry85391 Words   |  342 Pagesaccounting policy-making issues in the football industry. This includes an empirical study designed to identify the factors that influence accounting policy choice. In addition, the thesis contains further empirical work aimed at providing a model for valuing internally generated human resource assets in a manner acceptable for financial reporting purposes. Much of the recent debate over intangible asset accounting has focused on accounting for brands. The main points of contention concern theRead MoreStrategic Human Resource Management View.Pdf Uploaded Successfully133347 Words   |  534 Pagesrights reserved. This copyright covers material written expressly for this volume by the editor/s as well as the compilation itself. It does not cover the individual selections herein that first appeared elsewhere. ii Permission to reprint these has been obtained by Pearson Custom Publishing for this edition only. Further reproduction by any means, electronic or mechanical, including photocopying and recording, or by any information storage or retrieval system, must be arranged with the individualRead MoreCorporate Finance69408 Words   |  278 Pagesanalysis ............................................................................................... 30 The capital asset pricing model .................................................................................... 34 The Roll critique and empirical tests of the CAPM......................................................... 37 A reminder of your learning outcomes.......................................................................... 40 Key terms ...........................................Read MoreAppraisal Techniques of Public Investments and Projects62994 Words   |  252 Pagessensitivity analysis ..................................... ................................................ 145 4.7.4 Sensitivity and decision making ........................................................................................ 147 4.7.5 Determinants of sensitivity and common project risks ................................................ 148 4.7.6 General approaches to uncertainty and risk ................................................................... 149 4.7.7 Decision making when dealingRead MoreMba Solved Assignment Papers52670 Words   |  211 Pagespreviously discussed, the boundaries between them may be fuzzy): Exploratory research, which structures and identifies new  problems Constructive research, which develops solutions to a problem .Empirical research, which tests the feasibility of a  solution  using empirical evidence The research room at the New York  Public Library, an  example  of secondary research in progress. Research can also fall into two distinct types: Primary research Secondary research In social sciencesRead MoreProject on Risk Management46558 Words   |  187 PagesFinance Preface As a part of Management of Business Finance (MBF) programme, a student has to pursue a project duly approved by the Director of the Indian Institute of Finance. I had the privilege of undertaking a project on â€Å"Risk Management by INDUSIND BANK LTD.† My project report is divided into seven chapters and they are given as under: Chapter 1 INTRODUCTION Chapter 2 Review of literature Chapter 3 Research Methodology Chapter 4 Analysis Chapter 5 Consist of Findings,Read MoreMarketing Management130471 Words   |  522 Pagesof America for the Marketing functions, American Marketing Association (AMA) defines marketing as â€Å"Marketing consists of those activities involved in the flow of goods and services from the point of production to the point of consumption. The AMA has since amended its definition to read as: â€Å"Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and