On the nonlinear relationship between inflation and growth: A theoretical exposition

• 成果类型: Article
• 署名作者: Arawatari, Ryo; Hori, Takeo; Mino, Kazuo
• 署名单位: Nagoya University; Institute of Science Tokyo; Tokyo Institute of Technology; Doshisha University
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2017.12.001
• 发表日期: 2018
• 页码: 79-93
• 关键词: endogenous growth; Cash-in-advance constraints; heterogeneous agents; Nonlinear relationship

摘要

The relationship between inflation and growth is examined in an R&D-based model of endogenous growth in which the R&D abilities of agents are heterogeneous. We analytically demonstrate that if the distribution of ability has a fat and long tail, the relationship between inflation and growth becomes nonlinear; the negative relationship between inflation and growth is weaker in the heterogeneous ability economy than it is in the homogeneous ability economy for low inflation, whereas the opposite outcome holds for high inflation. Our numerical example shows that this nonlinear relationship between inflation and growth holds under plausible parameter values. (C) 2017 Elsevier B.V. All rights reserved.