Inflation and Growth: The Role of Institutions

Journal of Economics and Finance, Forthcoming

29 Pages Posted: 17 Dec 2019 Last revised: 7 Sep 2021

See all articles by Hakan Yilmazkuday

Hakan Yilmazkuday

Florida International University (FIU) - Department of Economics

Date Written: May 22, 2021

Abstract

This paper investigates the effects of inflation on per capita income growth for 36 developed and developing countries by using structural vector autoregression models that are robust to the consideration of endogeneity by construction. The results show evidence for heterogeneity of such effects across countries that are shown to be further connected to the strength of their institutions. While the effects of inflation on growth are negative and significant in countries with stronger institutions, they are positive and significant in countries with weaker institutions.

Keywords: Economic Growth, Institutions, Inflation, Structural VAR

JEL Classification: O11, O23, O43

Suggested Citation

Yilmazkuday, Hakan, Inflation and Growth: The Role of Institutions (May 22, 2021). Journal of Economics and Finance, Forthcoming, Available at SSRN: https://ssrn.com/abstract=3503569 or http://dx.doi.org/10.2139/ssrn.3503569

Hakan Yilmazkuday (Contact Author)

Florida International University (FIU) - Department of Economics ( email )

11200 SW 8th Street
Miami, FL 33199
United States

HOME PAGE: http://faculty.fiu.edu/~hyilmazk/

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