As origens e conseqüências da inflação na América Latina

Abstract

This paper criticizes a very popular model among Latin-American economists that has been used to explain the inflationary phenomenon based on the distributive conflict between capitalists and workers. The paper also presents a generalization of the Cagan hyperinflation model. The generalization consists of adding an IS curve and a Phillips curve to the Cagan model composed of an LM curve and the government's budget constraint. The dynamics of this expanded model shows the consequences for the economy of a monetary-fiscal policy regime in which the Central Bank is obliged to supply the government with fiscal revenue.