Asset Price Inflation in the 1980s: A Flow of Funds Perspective

1993 ◽  
Author(s):  
Monica Hargraves ◽  
Garry J. Schinasi ◽  
Steven R. Weisbrod
Keyword(s):  
Asset Price ◽  
Price Inflation ◽  
Flow Of Funds ◽  
Asset Price Inflation

scholarly journals An Analysis of the Relationship between Inflation and Gold Prices: Evidence from Pakistan

2013 ◽  
Vol 18 (2) ◽  
pp. 1-35 ◽  
Author(s):  
Saira Tufail ◽  
Sadia Batool
Keyword(s):  
Real Estate ◽  
Stock Prices ◽  
Foreign Currency ◽  
Stock Exchange ◽  
Asset Price ◽  
Price Inflation ◽  
Dual Nature ◽  
The Government ◽  
The Relationship ◽  
Unexpected Inflation

In this study, we formulate a new inflation equation to capture the potential effects of gold and stock prices on inflation in Pakistan. We aim to assess the inflation-hedging properties of gold compared to other assets such as real estate, stock exchange securities, and foreign currency holdings. Applying time-series econometric techniques (cointegration and vector error correction models) to data for 1960–2010, we find that gold is a potential determinant of inflation in Pakistan. On the other hand, it also provides a complete hedge against unexpected inflation. Real estate assets are more than a complete hedge against expected inflation, although stock exchange securities outperform gold and real estate as a hedge against unexpected inflation. Foreign currency proves to be an insignificant hedge against inflation. Given the dual nature of the relationship between gold and inflation, it is increasingly important for the government to monitor and regulate the gold market in Pakistan. Moreover, stock market investment should be encouraged by the government given that asset price inflation does not pose a critical problem for Pakistan as yet.

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