Abstract

ALVAREZ, Emiliano; BRIDA, Juan Gabriel; MARTINEZ, Mikaela  and  MONES, Pablo. Complex network analysis: A study of inflation in Uruguay. Finanz. polit. econ. [online]. 2022, vol.14, n.1, pp.131-166.  Epub July 23, 2022. ISSN 2248-6046.  https://doi.org/10.14718/revfinanzpolitecon.v14.n1.2022.6.

This paper studies the relationship between macroeconomic uncertainty and the behavior of the price system in the Uruguayan economy, using network analysis to represent the price system that makes up the Consumer Price Index (CPI). Networks were built using annual moving windows between 1997 and 2020, taking as nodes different classes of goods and services that conform the CPI. The empirical results show a set of central nodes surrounded by other peripheral ones, where the former is characterized by having asimilar dynamic to many other nodes in the network while the latter display an atypical behavior. These empirical findings demonstrate volatility in the price dynamics and its relationship with macroeconomic processes, as well as changes in the interrelationships between the prices that make up the CPI in Uruguay.

Keywords : inflation; prices; network analysis; complex systems; monetary policy; Uruguay.

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