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Heterogeneous corruption and inflation
https://doi.org/10.32609/0042-8736-2019-2-81-96
Abstract
The article analyzes the simultaneous influence of different types of corruption on inflation in the absence of seignorage. Basing on the model of fiscal and monetary policymakers behavior, we analyze the joint impact of “grand” and “petty cash” corruption on economy in short and long term in discretionary policy and rational expectation assumptions. Research findings demonstrate that even in the absence of seignorage heterogeneous corruption relates to inflation differently in short and long term: in the first case, relationship is positive and straightforward, in the second, some indirect effects take place what reduces equilibrium inflation in the long run compared to the short run.
About the Authors
I. L. Kavitskaya
National Research University Higher School of Economics
Russian Federation
Russian Federation
Irina L. Kavitskaya
Moscow
I. N. Safonov
National Research University Higher School of Economics
Russian Federation
Russian Federation
Igor N. Safonov
Moscow
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Review
For citations:
Kavitskaya I.L., Safonov I.N. Heterogeneous corruption and inflation. Voprosy Ekonomiki. 2019;(2):81-96. (In Russ.) https://doi.org/10.32609/0042-8736-2019-2-81-96
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