Sources and Determinants of Inflation in Sudan: An Empirical Analysis (1970 - 2003

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Abdel Mahmoud Ibrahim, Tahmad
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Today inflation and price stability remain a major concern to economists. The sources and determinants of inflation in Sudan are controversial in their origin, and subject to interrelated processes. Therefore, to determine the sources of inflation which appear in received literature to indicate that, inflation is often a product of interaction of multi-various economic and non-economic factors. Based on this an attempt is made to identify empirically the sources and determinants of inflation in Sudan for the period (1970-2003) by adopting a multi-variable model, using time-series data to test practically the factors considered responsible for inflation. Accordingly, an Ordinary Least Square (OLS) method is being used to carry out the analysis. The empirical results show that the main sources and determinants of inflation are: money supply growth rate (M), fall in real GDP growth rate (Y), world inflation (Pw), foreign exchange rate (E*), lagged budget deficit growth rate (GDt-1) and the annual rate of rainfall (W). The policy implications point out that, a package of economic policies including fiscal, monetary as well as foreign exchange policies as a means to combat and control inflation in Sudan is required. This research is organized as follows; Chapter one a layout of the study; Chapter two reviews the literature; while Chapter three outlines data and methodology, and Chapter four discusses and reports the empirical results together with some concluding remarks and recommendations
Sources , Determinants ,Inflation,Sudan,Empirical Analysis