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Business & Economics

A SHORT REVIEW ON INFLATION AND ITS IMPACT ON ECONOMIC GROWTH AND SOME CORRESPONDING MACROECONOMIC PARAMETERS
Nicoleta-Ramona Dinu, Adina Titei, Irena Munteanu, Ioana-Claudia Dobre, Florin Victor Jeflea

ABSTRACT: After decades of prices stability, the economies around the world are confronted with the revival of inflation as one of the consequences of the monetary, fiscal and public expenditure policies introduced by governments for pandemic management, policies that proved to be excessive in many cases. Under current conditions of uncertainity and high volatility of prices, a growing interest on inflation is noticeable at all levels. On the science scene, the literature flourished and investigated the phenomenon of inflation in the attempt to provide inter alia a better understanding of its effects on macroeconomic dynamics and to depict as phenomena unfold. Our paper is structured in two main parts. The first one is a bibliometric analysis designed to primarily outline a conceptual structure of the chosen scientific framework using co-occurrence of the keywords related to the topic of inflation. There follows an empirical application section, consisting in the instrumental description of the research methodology employed and in reference to the database concerning the case of Romania. Eleven models are developed. The inflation rate is kept as an exogenous variable in all the models, and the other factors determining the change in real GDP were final consumption, net exports, the leu-euro exchange rate, M3 money supply, the investment position and non-government loans. The results show the linear dependencies and the impact of inflation on GDP along with the other exogenous variables considered. The regression coefficients are statistically significant, the vast majority for a 1% significance threshold.

KEYWORDS:  inflation, real GDP, final consumption, net exports, money supply, investment position, non-government loans.

JEL classification:  C20, C50, E27, E31, E 52, F49