The Phenomenon of Stagflation in the Egyptian Economy
|Author(s):|| Ibrahim Awad , |
|Type:||Articles in refereed journals|
|ISSN / ISBN:||5465|
|Publishing place:||MPRA Papers|
|Keywords:||the phenomenon of stagphlation- the phenomenon of stagphlation in the egyptian economy|
|JEL codes:||G38 -E2 -C3 -E31- O11- E24|
|Abstract:||The study analyzes and explains the phenomenon of stagflation in the Egyptian economy. Firstly, the study focuses on the theoretical attempts to explain the phenomenon of stagflation in the various schools of economics. Secondly, In the light of the theoretical explanation of the phenomenon of stagflation, the study discussed the potential reasons for the occurrence of the phenomenon in the Egyptian economy. Thirdly, econometric analysis is used to determine the factors and the most dominant factors behind the phenomenon of stagflation in the Egyptian economy. Fourthly, in the light of the theoretical and the empirical analysis, the study explains the phenomenon of stagflation in the Egyptian economy.
The general conclusion of the study is that: the phenomenon of stagflation in the Egyptian economy might be referred to the higher of the cost of production and / or the structural changes in the Egyptian economy. The empirical analysis revealed that the phenomenon of stagflation in the Egyptian economy occurs because of the successive increases of the cost of production resulting from the higher of the cost of domestic intermediate goods, and the lower of the wages/output ratio.
While the lower of the wages/output ratio explain the higher rates of unemployment, the high product cost explains the higher rates of inflation. Importantly, the persistent of the rate of inflation at high level may refer to the chronically budget deficit.