A revised tobin effect from inflation: Relative input price and capital ratio realignments, US and UK, 1959-1999

Gillman, Max and Nakov, Anton 2001. A revised tobin effect from inflation: Relative input price and capital ratio realignments, US and UK, 1959-1999. [Working Paper]. Working papers series, vol. 4/2001. Budapest: Central European University (CEU) - Department of Economics.

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Abstract

The paper studies the realignments induced by inflation within an endogenous growth monetary economy. Accelerating inflation raises the ratio of the real wage to the real interest rate, and so raises the use of physical capital relative to human capital across all sectors. We find cointegration evidence for the US and UK economies consistent with a general equilibrium, Tobin-type, effect of inflation on input prices, and capital intensity, even while the growth rate of output is reduced by inflation.

Item Type:	Monograph (Working Paper)
Date Type:	Publication
Status:	Published
Schools:	Business (Including Economics)
Subjects:	H Social Sciences > HB Economic Theory H Social Sciences > HC Economic History and Conditions
Publisher:	Central European University (CEU) - Department of Economics
Last Modified:	19 Mar 2016 23:14
URI:	https://orca.cardiff.ac.uk/id/eprint/43797

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