Latin American Inflation (Sargent, Williams and Zha)

The conquest of South American inflation by Thomas Sargent, Noah Williams and Tao Zha. “This paper formulates a nonlinear stochastic model of inflation, inflationary ex-pectations, and money-creation-financed deficits and uses the implied density for the history of inflation to extract maximum likelihood parameter estimates for data from Peru, Argentina, Bolivia, Brazil, and Chile.”