Problem Of Inflation Research Articles

Konsep Uang Islam: Antara Uang Komoditas atau Uang Fiat

Recent monetary crises have brought back the interest of scholars especially Muslim scholars to re-evaluate the current fiat monetary system. A group of Muslim economists believe that the source of problems is a form of fiat money. However, a larger group of Muslim economists prefer to set fiat money according to the rules of Sharia. This paper attempts to discuss the opinion of these two groups, so then offers the concept of money in Islam. The first group argue that the fiat money creates a seigniorage which is the cause of inflation, inequity of wealth distribution and monetary and financial crisis. Fiat money is also the soul of banking fractional reserve system which leads to the problem of inflation, business cycles and injustice distribution of wealth. Lastly, fiat money sytem with interest result in an inflationary economy. Besides these three, there is a belief that the money according to Islam must be commodity money. The second group counter that the strict rules for monetary management is proved to minimize the use of seigniorage so that inflation can be controlled. In fact, the fiat money and fractional reserve system support economic expansion so that the community can enjoy the economic growth. Furthermore, the business cycle is not just happening on a fiat money system but also a part of the commodity money system. Indeed, money in Islam must be a commodity is not agreed by the majority of fiqh scholars. However, in the context of international currency, the issue of injustice and the causes of the crisis becomes challenging issue. The first group propose to change international currency to commodity money, while the second group offers a monetary union as in the case of Europe. Finally, the concept of money is not about the form of money, but rather whether the money can be a just medium of exchange and measure of value for the goods and services.

Impact of Fiscal Deficit on Inflation in Sri Lanka: An Econometric Time Series Analysis

There is a relationship between the fiscal deficit and inflation, which was confirmed empirically in several studies conducted in many countries. Sri Lanka has been encountering the problem of inflation for the recent years. But in Sri Lanka, this proposition has not yet been studied scientifically. Therefore, this study was going to fill this gap. The objective of this study was to test the impact of fiscal deficit on inflation in Sri Lanka. For this study, the annual time series data were used during the period of 1959 to 2013. The fiscal deficit, exchange rate, government expenditures and import outflow were used as independent variables while the Colombo consumer price index was considered as dependent variable. In addition, the multiple regressions model was used to test the impact of fiscal deficit on inflation. Based on the regression results, the fiscal deficit preserved the positive relationship with inflation in Sri Lanka at one percent significant level. Therefore, this study confirmed that the fiscal deficit accelerates the inflation in Sri Lanka.

Unimodular-mimetic cosmology

We combine the unimodular gravity and mimetic gravity theories into a unified theoretical framework, which is proposed to provide a suggestive proposal for a framework that may assist in the discussion and search for a solution to the cosmological constant problem and the dark matter issue. After providing the formulation of the unimodular mimetic gravity and investigating all the new features that the vacuum unimodular gravity implies, by using the underlying reconstruction method, we realize some well known cosmological evolutions, with some of these being exotic for the ordinary Einstein–Hilbert gravity. Specifically we provide the vacuum unimodular mimetic gravity description of the de Sitter cosmology and of the perfect fluid with constant equation of state cosmology. As we demonstrate, these cosmologies can be realized by vacuum mimetic unimodular gravity, without the existence of any matter fluid source. Moreover, we investigate how cosmologically viable cosmologies, which are compatible with the recent observational data, can be realized by the vacuum unimodular mimetic gravity. Since in some cases, a graceful exit from inflation problem might exist, we provide a qualitative description of the mechanism that can potentially generate the graceful exit from inflation in these theories, by searching for the unstable de Sitter solutions in the context of unimodular mimetic theories of gravity.

On Some Troubles with the Metaphysics of Fermionic Compositions

In this paper I discuss some metaphysical consequences of an unorthodox approach to the problem of the identity and individuality of “indistinguishable” quantum particles. This approach is based on the assumption that the only admissible way of individuating separate components of a given system is with the help of the permutation-invariant qualitative properties of the total system. Such a method of individuation, when applied to fermionic compositions occupying so-called GMW-nonentangled states, yields highly implausible consequences regarding the number of distinct components of a given composite system. I specify the problem (which I call the problem of fermionic inflation) in detail, and I consider several strategies of solving it. The preferred solution of the problem is based on the premise that spatial location should play a privileged role in identifying and making reference to quantum-mechanical systems.

Relevance of Low Inflation in the Southeastern European Countries

Abstract The paper starts from the assumption that the significant reduction of the inflation problem is a result of the long-term dynamics of economic growth in countries with developing markets and, as a result, operational inability of multinational companies to increase accumulation through the policy of raising prices by creating space for their full expansion. We believe that in such circumstances civil theories on the causes of inflation are dominantly of class character. We check negative repercussions of low inflation on the examples of the countries of South-East Europe, in the regimes with fixed and flexible exchange rates, and with different strategies of monetary policy. We conclude that destructive implications of the financial crisis and psychological factors have a negative impact on a sustainable low-inflation environment, regardless of the monetary-exchange regime. We propose that low and stable inflation rates can be followed by a series of negative implications for the overall economic system, which our analysis of the observed countries proves.

India’s Balance of Payments, Growth and Fiscal Policy

Following a dream run during 2003–2004 to 2010–2011, when India’s annual growth rate averaged close to 9 per cent in the midst of remarkable balance of payments (BOP) stability (except for the year 2008–2009), India has slumped into a recession accompanied by severe BOP difficulties and high rates of consumer price inflation. The Government of India (GoI) has responded to it by cutting down subsidies and hiking indirect tax rates. This article develops a simple Keynesian model to assess the policies noted above. It argues that the policies adopted so far by the GoI are likely to aggravate the problems of recession, BOP difficulties and inflation. It recommends hikes in personal income tax rates with a suitable expenditure policy to get out of the present macroeconomic instability. JEL Classification: E12, E32, F41

Topological inflation with graceful exit

We investigate a class of models of topological inflation in which a super-Hubble-sized global monopole seeds inflation. These models are attractive since inflation starts from rather generic initial conditions, but their not so attractive feature is that, unless symmetry is again restored, inflation never ends. In this work we show that, in presence of another nonminimally coupled scalar field, that is both quadratically and quartically coupled to the Ricci scalar, inflation naturally ends, representing an elegant solution to the graceful exit problem of topological inflation. While the monopole core grows during inflation, the growth stops after inflation, such that the monopole eventually enters the Hubble radius, and shrinks to its Minkowski space size, rendering it immaterial for the subsequent Universe's dynamics. Furthermore, we find that our model can produce cosmological perturbations that source CMB temperature fluctuations and seed large scale structure statistically consistent (within one standard deviation) with all available data. In particular, for small and (in our convention) negative nonminimal couplings, the scalar spectral index can be as large as ns ≃ 0.955, which is about one standard deviation lower than the central value quoted by the most recent Planck Collaboration.

Do quantitative monetary targets matter?

This paper evaluates the effects of monetary policy directed at inflation across different levels using panel data quantile regression and instrumental variable quantile regression methods. We identify a heterogeneous and nonlinear relationship between an explicit quantitative goal for monetary policy and inflation after controlling for the problem of possible endogeneity. We also find that both having and successfully hitting quantitative targets is more effective for monetary policy in lowering inflation in high-inflation episodes than in low-inflation episodes. When countries suffer from severe inflation problems, the adoption of quantitative goals for monetary policies can thus deliver important economic gains. Conversely, the adoption of quantitative goals may not result in a lowering of inflation when countries are more economically sound.

On Adam Smith's Wealth of Nations and the Continental (French), Intellectual Connection: There Was a Small, Intellectual Connection

The common view among economists is that Adam Smith’s technical and economic analysis in the Wealth of Nations (1776) was not original and/or had been borrowed, much without proper credit or citation being made to the original authors. Smith’s contribution was taking the works of others and integrating it into a systematic whole. This claim is demonstrated to be false. Much of Adam Smith’s work in the Wealth of Nations was highly original and creative. Smith’s work on decision theory, interval valued probability, the uncertainty versus risk divide, and his understanding of who the primary contributors were to the problems of deflation and inflation in the macro economy placed him at least 150 years ahead of any of his contemporaries. It was left to John Maynard Keynes and Joseph Schumpeter to equal and surpass Adam Smith’s contributions to economic theory and decision theory.

The Problems of Inflation and Pricing in Russia

The article analyzes the causes of the inflation processes and pricing stages in the Russian Federation through the example of food products in the process of their promotion to the consumer market. The factors are identified, which influence the price level, and their influence is analyzed. The existing practice of the price constituents’ formation is examined, which allowed to determining negative consequences of the lack of state control over the processes of prime cost calculation and justification in all links of the products flow, as well as for justification of rates offered by the monopolist enterprises and natural monopolies and justification of trade markups. The state’s role in pricing is evaluated. The current pricing legislation of Russia is analyzed, which does not solve the price growth issues. A review of price adjustment experience and the existing legislative practice in this area in the European countries is provided. Patterns for pricing improvement are determined with account of the foreign experience and the business environment specificity. DOI: 10.5901/mjss.2015.v6n5s4p197

Fine tuning may not be enough

We argue that the fine tuning problems of scalar-driven inflation may be worse than is commonly believed. The reason is that reheating requires the inflaton to be coupled to other matter fields whose vacuum fluctuations alter the inflaton potential. The usual response has been that even more fine-tuning of the classical potential V(φ) can repair any damage done in this way. We point out that the effective potential in de Sitter background actually depends in a complicated way upon the dimensionless combination of φ/H. We also show that the factors of H which occur in de Sitter do not even correspond to local functionals of the metric for general geometries, nor are they Planck-suppressed.

Approximated Solutions for Axisymmetric Wrinkled Inflated Membranes

The axisymmetric inflation problem for a wrinkled membrane is solved by means of a simple nonlinear ordinary differential equation. The solution is illustrated in full details. Both the free and constrained cases are addressed, in the limit case where the membrane is fully wrinkled. In the constrained inflation problem, no slippage is allowed between the membrane and the constraining surfaces. It is shown that an actual membrane can in no way reach the fully wrinkled configuration during free inflation, regardless of the membrane's initial configuration and constituent material. The fully wrinkled solution is compared to some finite element results obtained by means of an expressly developed iterative–incremental procedure. When the values of the inflating pressure and length of the meridian lie within a suitable applicability range, the fully wrinkled solution may represent a reasonable approximation of the actual solution. A comparison with some numerical and experimental results available in the literature is illustrated.

Instability investigation on fluid-loaded pre-stretched cylindrical membranes

This paper discusses the evaluation of instabilities on the quasi-static equilibrium path of fluid-loaded pre-stretched cylindrical membranes and the switching to a secondary branch at a bifurcation point. The membrane is represented by only the in-plane stress components, for which an incompressible, isotropic hyperelastic material model is assumed. The free inflation problem yields governing equations and boundary conditions, which are discretized by finite differences and solved by a Newton–Raphson method. An incremental arclength-cubic extrapolation method is used to find generalized equilibrium paths, with different parametrizations. Limit points and bifurcation points are observed on the equilibrium path when fluid level is seen as the controlling parameter. An eigen-mode injection method is employed to switch to a secondary equilibrium branch at the bifurcation point. A limit point with respect to fluid level is observed for a partially filled membrane when the aspect ratio (length/radius) is high, whereas for smaller aspect ratios, the limit point with respect to fluid level is observed at over-filling. Pre-stretch is observed to have a stiffening effect in the pre-limit zone and a softening effect in the post-limit zone.

The economic effects of a stronger dollar

A stronger dollar might help exports for some emerging markets, but through other channels it could have a negative impact on growth and financial stability. Our analysis suggests a re‐run of the crisis conditions of 1998-99 is unlikely, but there are areas of significant vulnerability. The dollar's strength reinforces our view that emerging growth will slow in 2015, to the slowest pace since 2009 – with risks to the downside. Dollar strength may be negative for emerging markets via several channels – by increasing the burden of dollar‐denominated debt, by lowering key commodity prices, by choking off capital inflows and forcing up interest rates and by triggering private sector deleveraging. These channels will operate to different degrees in different countries, though overall emerging markets look less risky than they did at the end of the 1990s. Highly indebted countries with inflation problems and high commodity dependence are the most at risk from dollar strength. Looking across the various indicators of vulnerability we see Malaysia, Chile, Turkey, Russia and Venezuela as most vulnerable. Among the countries better placed to weather a strong dollar are China and India.

Climate Change and Food Security in South Asia HDR 2011

Climate change has the potential to be the most significant challenge to human development in the near future, it is not only an environmental issue but also one that affect our very existence because of its direct links with agriculture and food security. The most painful reality of climate change is that it is the poorer countries that stand to suffer most, and it is the poorest in the poor countries that have the least capacity to withstand the effects of climate change. At a time when South Asia is seized with the problem of poverty and inflation, it stands to be further aggravated by climate change. Therefore, the action ought to be on the most vulnerable sector that climate change will affect i.e. food and agriculture.Across South Asia (Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka), large proportion of the population depend on agriculture for their livelihoods. Most of the South Asia receives Monsoons every year, but rainfall in the semi-arid and sub-humid regions of South Asia is highly variable and unpredictable and influences agricultural productivity accordingly. Over the centuries, farming practices in the South Asia has developed as a response to local climatic conditions. The greatest challenge that South Asia faces is lifting some 500 million people out of poverty, but this already-formidable challenge is made all the more difficult because along with local environmental repercussions of intensive agriculture, global warming has also started to affect food production, raising food deficit over the last two decades, showing stagnation in productivity curve of the Green Revolution agricultural miracle of South Asia.The environmental challenges due to climate change, such as water shortages and storms resulting in soil erosion threaten future social upheavals, climate change migrants and political conflicts in the region.

Helical phase inflation

We show that the quadratic inflation can be realized by the phase of a complex field with helicoid potential. Remarkably, this helicoid potential can be simply realized in minimal supergravity. The global $U(1)$ symmetry of the K\"ahler potential introduces a flat direction and evades the $\eta$ problem automatically. So such inflation is technically natural. The phase excursion is super-Planckian as required by the Lyth bound, while the norm of the complex field can be suppressed in the sub-Planckian region. This model resolves the ultraviolet sensitive problem of the large field inflation, besides, it also provides a new type of monodromy inflation in supersymmetric field theory with consistent field stabilization.

An evaluation of gold as an inflation hedge: Empirical evidence from South Africa

The plague of inflation eating into investor returns is one that is experienced universally by all investors. Gold has historically proven to provide good inflationary hedging ability, due to its appreciating prices in times of high inflation. However, the recent period of price depreciation from 2012 amidst rising inflation in South Africa, has brought its usefulness as a hedge into question. The purpose of this study is therefore to thoroughly examine the use of gold as an inflationary hedge in the South African environment. In South Africa, the problem of inflation is a particularly severe one, with inflation rates reaching double figures periodically. The necessity of a hedge against inflation is therefore imperative to South African investors, to mitigate their diminishing real returns. The study extends over the period of 2000 – 2014, to incorporate for the Monetary Policy Committee in South Africa’s introduction of the inflation targeting regime. In South Africa, there are two popular alternatives when purchasing gold – one is gold bullion, whilst the other is known as the Krugerrand. The Krugerrand is minted from 22 carat gold, and is a popular vehicle for private gold investment in South Africa – and therefore easily accessed by both private and institutional investors. We therefore utilized both gold and the krugerrand as possible hedges in order to evaluate whether there is any difference in their respective hedging ability, and in particular, which one is more appropriate. We also decomposed inflation into the different types, which are: actual, expected, and unexpected inflation. Testing was conducted on the data over both the short run and long run, by making use of OLS regressions for the short run analysis, and Johansen’s Cointegration for the long run analysis. The results of the short run statistical tests found that whilst both gold and the krugerrand were found to be statistically significant against unexpected inflation, their sign was negative – which indicate that when unexpected inflation increases, the gold price decreases, which is contrary to the way in which a hedge should perform. The long run analysis found that both gold and the krugerrand were able to hedge against both actual and unexpected inflation, but not anticipated inflation. The results overall also found that gold had the superior hedging ability from the two alternatives. This may indicate that for investors who are concerned with the long run effects of inflation on their portfolios, they can include gold as a potential hedge against its negative effects.

Post-Keynesian alternative policies to curb macroeconomic imbalances in the Euro area

In this paper we outline alternative post-Keynesian policy recommendations addressing the problems of differential inflation, divergence in competitiveness and associated current account imbalances within the Euro area. We provide a basic framework in order to systematically address the related issues making use of Anthony P. Thirlwall?s (1979, 2002) model of a ?balance-of-payments-constrained growth rate? (BPCGR). Based on this framework, we outline the required stance for alternative economic policies and then we discuss the implications for alternative monetary, wage/incomes and fiscal policies in the Euro area as a whole, as well as the consequences for structural and regional policies in the Euro area periphery, in particular.

Origin of probabilities and their application to the multiverse

We argue using simple models that all successful practical uses of probabilities originate in quantum fluctuations in the microscopic physical world around us, often propagated to macroscopic scales. Thus we claim there is no physically verified fully classical theory of probability. We comment on the general implications of this view, and specifically question the application of classical probability theory to cosmology in cases where key questions are known to have no quantum answer. We argue that the ideas developed here may offer a way out of the notorious measure problems of eternal inflation.

THE G+M ECLIPSING BINARY V530 ORIONIS: A STRINGENT TEST OF MAGNETIC STELLAR EVOLUTION MODELS FOR LOW-MASS STARS

We report extensive photometric and spectroscopic observations of the 6.1-day period, G+M-type detached double-lined eclipsing binary V530 Ori, an important new benchmark system for testing stellar evolution models for low-mass stars. We determine accurate masses and radii for the components with errors of 0.7% and 1.3%, as follows: M(A) = 1.0038 +/- 0.0066 M(sun), M(B) = 0.5955 +/- 0.0022 M(sun), R(A) = 0.980 +/- 0.013 R(sun), and R(B) = 0.5873 +/- 0.0067 R(sun). The effective temperatures are 5890 +/- 100 K (G1V) and 3880 +/- 120 K (M1V), respectively. A detailed chemical analysis probing more than 20 elements in the primary spectrum shows the system to have a slightly subsolar abundance, with [Fe/H] = -0.12 +/- 0.08. A comparison with theory reveals that standard models underpredict the radius and overpredict the temperature of the secondary, as has been found previously for other M dwarfs. On the other hand, models from the Dartmouth series incorporating magnetic fields are able to match the observations of the secondary star at the same age as the primary (3 Gyr) with a surface field strength of 2.1 +/- 0.4 kG when using a rotational dynamo prescription, or 1.3 +/- 0.4 kG with a turbulent dynamo approach, not far from our empirical estimate for this star of 0.83 +/- 0.65 kG. The observations are most consistent with magnetic fields playing only a small role in changing the global properties of the primary. The V530 Ori system thus provides an important demonstration that recent advances in modeling appear to be on the right track to explain the long-standing problem of radius inflation and temperature suppression in low-mass stars.