@article{9fb01cca35ae43d0865a30d7f5307161,
title = "The resurgence of inflation in Brazil, 1974-1986",
abstract = "This paper examines various factors which contributed to the resurgence of inflation in Brazil in the 1970s and 1980s, and the reasons for the failure of ortodox austerity programs to control it. The evidence seems to black the school of thought which considers the best explanation for the recent inflationary experience to lie with the spread of formal and informal indexing, leading to an inertial type of inflation. The latter has led some economists to recommend heterodox methods of inflation control. An epilogue briefly describes Brazil's recent attempt to apply such methods.",
author = "Werner Baer",
note = "The negative real growth of MI has been attributed to the decline in the demand for money as inflation continued to accelerate. There was a switch to quasi-money, part of which was indexed to inflation, such as savings and time deposits and government securities. The latter became increasingly liquid. This explains the behavior of Mz and Mi. It is also noteworthy that the monetary assets of the financial system (currency and demand deposits) declined from 43% in 1972 to 10% in 1984a nd thus the “. . . yield of the inflation tax to the monetary authorities (that is the rate of inflation times the real value of the monetary base, or zero cost liabilities of the monetary authorities), for any given level of inflation, has been correspondingly reduced.“{\textquoteleft}X As inflation accelerated in the 1980s the velocity of circulation of Mr also increased, which was reflected in a decrease of the monetary base in relation to GDP from 7.0% in 1979 to 3.9% in 1984.{\textquoteleft}” The continued growth of the monetary base throughout the 1970s has been attributed to foreign capital inflows and to special extra-budgetary activities of the government. The latter was financed by the collaboration of the Central Bank and the Banco do Brasil to cover certain activities through what was euphemistically called the conta de movimento (movement account).",
year = "1987",
month = aug,
doi = "10.1016/0305-750X(87)90169-0",
language = "English (US)",
volume = "15",
pages = "1007--1034",
journal = "World Development",
issn = "0305-750X",
publisher = "Elsevier BV",
number = "8",
}