THE CORRELATION BETWEEN INFLATION AND ECONOMIC GROWTH IN ROMANIA
Diana Viorica Lupu
The purpose of this paper is to highlight the existence of interdependencies between the phenomena of inflation and that of the growth process, but also to analyze the development of both phenomena in Romania. Preferences on issues of relationship with inflation and economic growth is necessary and a priority, both because its analysis reveals huge potential for development and for fact that it promotes the transition process in Romania which was the route to short and efficient functioning of competitive market economy. Reality shows that the stimulating effect of inflation on economic growth does not increase with its amplification but is restricted to certain limits. By a methodological point of view, the research was conducted as ideological and quantitative approach, using appropriate techniques of analysis and interpretation. The research results show that the relationship inflation – economic growth can be seen in two ways, one that reflects the positive aspect, the other that highlights the negative aspect of the relationship between the two. Following the investigations, we conclude that in Romania controlling inflationary phenomenon since 2000 has led to positive rates of GDP growth.
Key words: inflation, economic growth, inflation target