Abstract:

Given the existent relation between capital motivation, performance, productivity, consumption and inflation, the current paper aims at determining some of the causes of inflation in Romania, focusing on the relationship between the changes in net wages and inflation. The analysis was developed based on the autoregressive vector estimated for the quarterly inflation rate and the change in net wages. Several econometrical tests have been used in order to construct the analysis, such as: VAR model analysis, Portmanteau model, LM test and the response to impulse functions, as well as variation decomposition. We conclude that changes in wages within the Romanian economy do influence inflation but not in large degree mainly because inflation within this transition country has had several characteristics that are very
common among emerging countries.