Fighting Inflation in Latin America
Year: 1997
Type: article
Abstract: Inflation has been a chronic problem for Latin American economies since the Second World War. In the 1980s, inflation ran out of control in many countries. This article analyses the causes of these high inflation rates and discusses the experiences of Latin American countries in fighting (hyper‐) inflation in the 1980s and 1990s. Particular attention is given to the relative merits of orthodox versus heterodox approaches, and to the use of the exchange rate as an inflation stabilizer. The article concludes, among other things, that achieving fiscal balance is crucial, whatever method is used, and that a fixed exchange rate can help to stabilize inflation but contains many risks, in particular with open capital accounts.
Source: Development and Change
Author: A. Dijkstra
Institution: International Institute of Social Studies
Language: English
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W2121205591