Inflation Tolerances, Expectations and Socio-Political Strategies
Inflation Tolerances, Expectations and Socio-Political Strategies Ganga Prasad Rao Energy, Environmental and Mineral Economist gangaprasad.rao@gmail.com gprasadrao@hotmail.com Disclaimer : The Author makes no claims to the factuality of the content, or the outcomes indicated in the designs proposed hereinunder. In the long run, inflation is my Dad,.......... even Mom! Introduction Inflation is in the news.... yet again! This time, it is the right-leaning BJP-led government making a compact with the RBI to manage inflation within a broad-band. Sounds quite fair and uncomplicated. After all, it is the Government's business to make decisions that concern the fisc, and the Central bank's mandate to manage monetary policy, including inflation, in a manner consistent with the Government's short- and intermediate-term macroeconomic plans. But look deeper......and ask what if the RBI does not get it right? It is universally known among Monetary economists that inflation,