Modeling inflation for Mali, Issues 2007-2295
International Monetary Fund, 2007 - Business & Economics - 34 pages
This paper investigates how consumer price inflation is determined in Mali for 1979-2006 along three macroeconomic explanations: (1) monetarist theories, emphasizing the impact of excess money supply, (2) the structuralist hypothesis, stressing the impact of supply-side constraints, and (3) external theories, describing the effects of foreign transmission mechanisms on a small open economy. The analysis makes use of cointegration techniques and general-to-specific modeling. Average national rainfall, and to a lesser extent deviations from monetary and external sector equilibrium are found to be the main long-run determinants of inflation. The paper offers policy recommendations for controlling inflation in Mali.
What people are saying - Write a review
We haven't found any reviews in the usual places.
Other editions - View all
1ai3fall adjustments affects inflation assets author's calculations average national rainfall broad money Burkina Faso cereal production CFA franc CFAF coefficient cointegration analysis cotton export prices decreases inflation deflation demand for broad demand for money depo depreciation determinants of inflation devaluation disequilibrium domestic interest rate droughts dummy variables ecmm effective exchange rate euro expected signs external sector food price inflation French bonds French franc heteroscedasticity idepo idisc important incorporates a constant inflation equation inflation in Mali inflation model inflationary effect interest and exchange interest rate long-run equilibrium macroeconomic Malian authorities monetarist money demand money market multivariate test negative nominal null hypothesis p-values period policies PPP holds price index proxied quarters later rate of inflation rate of return real exchange rate real income reduce food shortages reer significant sources of variables specification stability stationary statistics structuralist supply-side constraints terms of trade Tests for Omitted variables in logarithm WAEMU countries