¿Temor a la flotación o a la inflación? : la importancia del “traspaso” del tipo de cambio a los precios

Abstract

This work studies the pass-through from exchange rates to prices during the transition from high inflation scenarios to scenarios where inflation is low and stable. The aim is to determine whether regimes in which inflation is low and stable foster a reduction in the size of the pass-through and, therefore, weaken the so-called “fear of floating” phenomenon experienced by some small, open economies. For a sample of small, open economies, which in recent years have managed to reduce their inflation rates, it is shown that the intensity of the pass-through falls as inflation lowers. Thus, it is argued that once nominal variables are stabilized, “fear of inflation” that any central bank must have does not imply “fear of floating.”