WP-09: Macroeconomic determinants of Vietnam's inflation 2000-2010: Evidence & analysis

In this study, we use an evidence based approach to identify and analyze the key drivers of

inflation in Vietnam in recent years. The literature on inflation in Vietnam, which is mainly not

up-to-date with recent events and changes, focuses on the demand-pull factors of inflation and ignores the cost-push factors. The only consideration for supply side factors is the inclusion of world prices (often as external supply shock). Also, one important demand factor that has not been studied (quantitatively) is the role of budget deficit and public debt on inflation. The study is expected to provide the current policy debates in Vietnam with a reliable, scientific and evidence-based macroeconomic research on the main causes of inflation. As controlling inflation is one of the key concerns of the policy agenda this year and the next, this study hopes to clarify the problem and contribute to the macro policy making process.

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