International Monetary Fund World Economic Outlook database

A battle between regional governments can give rise to hyperinflation. [2] To simplify the issue, suppose that each region in Argentina has its own printing press. Each region can then independently undertake monetary policy by printing Argentine pesos and using those pesos to fund projects within their regions. The inflation tax is very tempting in these circumstances: a regional government can in effect tax people in other regions to help pay for its own projects. Why? Because printing money results in an inflation tax on everyone who has pesos. If money is printed in one region, some of the inflation tax will be paid by people in other regions who have pesos. To be concrete, imagine you are a politician in Buenos Aires who wants to raise 100 million pesos for a project in that city. You could levy an income tax on citizens of your area. Alternatively, you could print 100 million pesos. If you impose the income tax, your own citizens must pay it all. If you impose the inflation tax, people living in other regions of Argentina pay some of the tax. Your constituents get the benefit, but others bear a large part of the costs. Acting in the interests of your constituents, you print the pesos. Of course, this story is true not only for you but also for the leaders in all regions. In the end, there is excessive money growth in the economy as a whole and high inflation. The monetary authorities are weak because no single authority controls the overall money supply. The situation we have described is sometimes called a prisoners’ dilemma. In a prisoners’ dilemma, the actions of one person imposes costs on others, and the behavior that is best for each individual decision maker (in this case, all the regional monetary authorities) is not best for the country as a whole. Toolkit: Section 16.9 “Nash Equilibrium” If you are interested in more detail on the prisoners’ dilemma game, you can review it in the toolkit.

Don't use plagiarized sources. Get Your Custom Essay on
 International Monetary Fund World Economic Outlook database
Just from $13/Page
Order Essay
Essay Writing Pros
Calculate your paper price
Pages (550 words)
Approximate price: -

Why Work with Us

Top Quality and Well-Researched Papers

Our writers have been trained on how to handle papers placed by our clients. The writer must read and understand before embarking on writing the papers. In case of any issue that needs clarification, writers are encouraged to ask the client or support.

Professional and Experienced Academic Writers

Our team comprises of the best writers and editors. We do thorough vetting during recruitment to make sure that our writers have the knowledge and experience we aspire in the team.

Free Unlimited Revisions

Our aim is to give the client the best outcome. If for some reason you are not satisfied with the wok done, you can ask the paper to be revised or rewritten. This will be done to your satisfaction with no extra charges.

Prompt Delivery and 100% Money-Back-Guarantee

We have writers who work round the clock. This helps in making sure that all our clients’ papers are delivered on time. If we have issues with the deadline, we will ask for extension. If its not possible, the money is fully refunded.

Original & Confidential

Our clients’ confidentiality is highly respected. We can never disclose our clients’ details to third parties. In the same regard, we strive to give our clients 100% original papers. We do not tolerate plagiarism from our writers.

24/7 Customer Support

Clients can reach us any time of the day, and any day of the week. There is a live chat, email or phone numbers to help in ease of communication.

Try it now!

Calculate the price of your order

Total price:

How it works?

Follow these simple steps to get your paper done

Place your order

Fill in the order form and provide all details of your assignment.

Proceed with the payment

Choose the payment system that suits you most.

Receive the final file

Once your paper is ready, we will email it to you.

Our Services

You should never be worried about your papers even in the middle of the night. Our team will work round the clock to deliver.


Essay Writing Service

We have an able team that can deliver your work in the shortest time possible. The academic level or the type of work should never be a hindrance. Our highly competent support team is always around (24/7) to give you any assistance you may need.


Admission Essays & Business Writing Help

Do you need to be admitted in your dream institution but find it challenging to write an admission essay? Our team is in a position to write the best letter that will guarantee you an admission. We do as well write the best business proposals and reports.


Editing Support

Writing can be fun and enjoyable when everything has been done right. Writing is not just enough without proper editing and proofreading. We have a team of editors that ensure everything falls in place, whether its issues to do with grammar or referencing styles.


Revision Support

Once the paper has been done and submitted, that is not the end of it. You can always ask for amendment or improvement if you feel something has not been done right. Our team of writers and editors will gladly assist you to your satisfaction. Revision is free of charge.