Inflation became the dominant economic, social, and political problem of
the industrialized West during the 1970s. This book is about how the
inflation came to pass and what can be done about it. Certain to provoke
controversy, it is a major source of new empirical information and
theoretical conclusions concerning the causes of international
inflation.
The authors construct a consistent data base of information for eight
countries and design a theoretically sound model to test and evaluate
competing hypotheses incorporating the most recent theoretical
developments. Additional chapters address an impressive variety of
issues that complement and corroborate the core of the study. They
answer such questions as these: Can countries conduct an independent
monetary policy under fixed exchange rates? How closely tied are product
prices across countries? How are disturbances transmitted across
countries?
The International Transmission of Inflation is an important
contribution to international monetary economics in furnishing an
invaluable empirical foundation for future investigation and discussion.