Science Journal of Economics Volume 2013 (2013), December 2013
© Author(s) 2013. This work is distributed under the Creative Commons Attribution 3.0 License.
Exploration of sources of Tunisian inflation rate fluctuations
Author: Olfa Manai Daboussi and Asma Madouri
Higher Institute of Management University of Tunis
Accepted 27 November 2013; Available Online 30 December 2013
By using a Structural Vector Autoregression model, we study the effects of terms of trade, supply, fiscal, balance of payments and monetary shocks on the Tunisian quarterly inflation rate for the period 1987:Q3 to 2012:Q4. Empirical results highlight the dominance of monetary shocks. Supply shocks significantly affect the inflation rate while terms of trade, budget deficits and balance of payments shocks have a little contribution. Such results may be useful when deciding to manage Tunisian inflation rate.
Keyword:Inflation, SVAR model, Tunisian economy.