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- Title
Measuring the distributional effects of inflation in Croatia by using the LES approach.
- Authors
Drezgić, Saša
- Abstract
This paper deals with distributional effects of price changes in period from 2000 to 2007. Even though in this period we can observe relatively low inflation rates, the goal of the research is to determine whether there are possible negative effects of price changes on income inequality in Croatia. The approach bases on the application of linear expenditure system (LES) on the aggregate data, i.e. deciles of household income groups. The results show that overall inflation rate does not determine distributional effects in Croatia. In some years, changes in prices present higher burden for lower income groups, while in other years, higher income groups are worse off. It seems that redistributive effect primarily depends on the structure of price changes. Therefore we need further research on this issue.
- Subjects
CROATIA; PRICE variance; PRICE flexibility; PRICE increases; PRICE inflation; EFFECT of inflation on income; INCOME inequality
- Publication
Proceedings of Rijeka Faculty of Economics: Journal of Economics & Business, 2008, Vol 26, Issue 2, p239
- ISSN
1331-8004
- Publication type
Article