Modeling Inflation for Mali

December 1, 2007

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Format: Chicago

Mame Astou Diouf. Modeling Inflation for Mali, (USA: International Monetary Fund, 2007) accessed November 24, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper investigates how consumer price inflation is determined in Mali for 1979-2006 along three macroeconomic explanations: (1) monetarist theories, emphasizing the impact of excess money supply, (2) the structuralist hypothesis, stressing the impact of supply-side constraints, and (3) external theories, describing the effects of foreign transmission mechanisms on a small open economy. The analysis makes use of cointegration techniques and general-to-specific modeling. Average national rainfall, and to a lesser extent deviations from monetary and external sector equilibrium are found to be the main long-run determinants of inflation. The paper offers policy recommendations for controlling inflation in Mali.

Subject: Demand for money, Inflation, Monetary base, Personal income, Real exchange rates

Keywords: CFA franc, Inflation model, Price inflation, U.S. dollar, WP

Publication Details

Pages:

34
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2007/295
Stock No:

WPIEA2007295
ISBN:

9781451868586
ISSN:

1018-5941

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