Inflação, indexação e preços relativos: novas evidências para o Brasil

Abstract

This paper tests the relationship between inflation and the variance of relative prices in Brazil; the relevant literature postulates a positive relationship between these variables as suggested by the review shown in the first section. The Brazilian evidence from 1975 to 1990 shows that the degree of relative price variance is strongly influenced by the stabilization plans that took place in the second half of the 80's due to the use of price freezes. The econometric analysis did not confirm the existence of a positive correlation between inflation and the dispersion of relative prices. Since our measure actually reflects the deviation relative to the mean, the presence of indexation mechanisms may explain why, despite inflationary acceleration, the dispersion has not increased in the same proportion. We also show that this does not mean a constant structure of relative prices because synchronization is not an automatic implication of indexation.