Using a micro-foundation based monetary Small Open Economy (SOE) model of McCandless (2008) with a cash-in-advance constraint, a capital adjustment cost, foreign bonds, and a trade sector, the study quantifies the welfare implications under two policy scenarios: (a) a reduction in inflation...

The study analyzes the effect of inflation volatility on growth in the presence of different degrees of institutional development. A nonlinear growth regression specification using a system Generalized Method of Moments (GMM) procedure on a sample of 37 countries over the period 1989–2006...