## One Hundred Inflation Shocks: Seven Stylized Facts

_IMF Working Papers, September 15, 2023_

## Source details

**Canonical URL:** [One Hundred Inflation Shocks: Seven Stylized Facts](https://www.imf.org/en/publications/wp/issues/2023/09/13/one-hundred-inflation-shocks-seven-stylized-facts-539159)

## Other formats

- [Markdown version](/en/publications/wp/issues/2023/09/13/one-hundred-inflation-shocks-seven-stylized-facts-539159/index.md)
- [Structured JSON version](/en/publications/wp/issues/2023/09/13/one-hundred-inflation-shocks-seven-stylized-facts-539159/index.json)
- [Bundle manifest](/en/publications/wp/issues/2023/09/13/one-hundred-inflation-shocks-seven-stylized-facts-539159/bundle-manifest.json)

## Bibliographic details
- Authors: Anil Ari, Carlos Mulas-Granados, Victor Mylonas, Lev Ratnovski, Wei Zhao
- Published: September 15, 2023
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9798400254369.001

---

### Main findings
- The paper identifies over 100 inflation shock episodes in 56 countries since the 1970s, including over 60 episodes linked to the 1973–79 oil crises.
- Only in 60 percent of the episodes was inflation brought back down (or “resolved”) within 5 years.
- Even in these “successful” cases, resolving inflation took, on average, over 3 years.
- Success rates were lower and resolution times longer for episodes induced by terms-of-trade shocks during the 1973–79 oil crises.
- Most unresolved episodes involved “premature celebrations”, where inflation declined initially, only to plateau at an elevated level or re-accelerate.

### Comparative patterns between resolved and unresolved episodes
- Countries that resolved inflation had:
  - tighter monetary policy that was maintained more consistently over time,
  - lower nominal wage growth,
  - less currency depreciation,
  compared to unresolved cases.

### Macroeconomic outcomes of successful disinflations
- Successful disinflations were associated with short-term output losses.
- Successful disinflations were not associated with larger output, employment, or real wage losses over a 5-year horizon, potentially indicating the value of policy credibility and macroeconomic stability.

---

## Content in this bundle

- **Working Paper**
  - [Working Paper (Markdown version)](/-/media/files/publications/wp/2023/english/wpiea2023190-print-pdf.pdf.md){rel="alternate" type="text/markdown"}
  - [Working Paper (PDF)](/-/media/files/publications/wp/2023/english/wpiea2023190-print-pdf.pdf){rel="external" type="application/pdf"}

---

_Source: https://www.imf.org/en/publications/wp/issues/2023/09/13/one-hundred-inflation-shocks-seven-stylized-facts-539159_