Os preços administrados e a condução de política monetária no Brasil

Teles, Vladimir Kuhl
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The aim of this work is to analyze the behavior of regulated prices in Brazil. We argue that such prices are more persistent than all other indices used to study the Brazilian inflationary process. In order to fulfill our aim we first investigated some inflation persistence tests. Then, we used Vector Error Correction (VEC) models to assess the relationship between regulated prices and some important variables such as output, exchange rate, market prices and Selic interest rate. As well as that, we made use Mankiw and Reis' (2003) methodology so as to study which price index would be more suitable to keep economic activity as close as possible to potential output. The main results are as follows: i) persistence related to IPCA comes mainly from regulated prices; ii) policymakers respond more promptly to perturbations coming from regulated prices: iii) Mankiw and Reis' (2003) methodology shows that the percentage of regulated prices that makes part of IPCA should be less than it actually is so that there is a stabilizing price index. Therefore, we were able to show that regulated prices cause a lot of difficulties in the monetary policy conduct in Brazil.

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