{
  "title": "Does Political Instability Lead to Higher Inflation? A Panel Data Analysis",
  "publication": "IMF Working Papers, March 1, 2005",
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  "summary": "Economists generally accept the proposition that high inflation rates generate inefficiencies that reduce society's welfare and economic growth.",
  "sections": [
    {
      "heading": "Summary",
      "content": "- Economists generally accept the proposition that high inflation rates generate inefficiencies that reduce society's welfare and economic growth.\n- Determining the causes of the worldwide diversity of inflationary experiences remains an important challenge.\n- Based on a dataset covering around 100 countries for the period 1960-99 and using modern panel data econometric techniques to control for endogeneity, this paper shows that a higher degree of political instability is associated with higher inflation.\n- The paper also draws relevant policy implications for the optimal design of inflation-stabilization programs and of the institutions favorable to price stability."
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    {
      "heading": "Key Findings",
      "content": "- A higher degree of political instability is associated with higher inflation (finding derived from panel data analysis covering around 100 countries, 1960-99).\n- The study uses modern panel data econometric techniques to control for endogeneity."
    },
    {
      "heading": "Data and Methods",
      "content": "- Dataset coverage: around 100 countries.\n- Time period: 1960-99.\n- Methodology: modern panel data econometric techniques with controls for endogeneity."
    },
    {
      "heading": "Policy Implications",
      "content": "- The paper draws relevant policy implications for:\n  - the optimal design of inflation-stabilization programs, and\n  - the design of institutions favorable to price stability.\n\n---\n\n Content in this bundle\n\n- wp0549\n  - wp0549 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - wp0549 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/31/does-political-instability-lead-to-higher-inflation-a-panel-data-analysis-18032"
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    "Authors: Ari Aisen, Francisco José Veiga",
    "Published: March 1, 2005",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781451860689.001",
    "Economists generally accept the proposition that high inflation rates generate inefficiencies that reduce society's welfare and economic growth.",
    "Determining the causes of the worldwide diversity of inflationary experiences remains an important challenge.",
    "Based on a dataset covering around 100 countries for the period 1960-99 and using modern panel data econometric techniques to control for endogeneity, this paper shows that a higher degree of political instability is associated with higher inflation.",
    "The paper also draws relevant policy implications for the optimal design of inflation-stabilization programs and of the institutions favorable to price stability.",
    "A higher degree of political instability is associated with higher inflation (finding derived from panel data analysis covering around 100 countries, 1960-99).",
    "The study uses modern panel data econometric techniques to control for endogeneity.",
    "Dataset coverage: around 100 countries.",
    "Time period: 1960-99.",
    "Methodology: modern panel data econometric techniques with controls for endogeneity.",
    "The paper draws relevant policy implications for:",
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