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Canadian Journal of Economics

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Опубликовано на портале: 11-01-2003
Jim Dolmas, Gregory W. Huffman, Mark A. Wynne Canadian Journal of Economics. 2000.  Vol. 33 . No. 1 . P. 271-287 . 
What can account for the different contemporaneous inflation experiences of various countries, and of the same country over time? We present an analysis of the determination of inflation from a political economy perspective. We document a positive correlation between income inequality and inflation and then present a theory of the determination of inflation outcomes in democratic societies that illustrates how greater inequality leads to greater inflation, owing to a desire by voters for wealth redistribution. We conclude by showing that democracies with more independent central banks tend to have better inflation outcomes for a given degree of inequality.
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