02336cas a2200241 a 4500 AALejournalIMF010548 230101c9999 xx r poo 0 0eng d 15.00 USD 9781451956023 1020-7635 BD-DhAAL BD-DhAAL International Monetary Fund. Research Dept. IMF Staff Papers : Volume 10, No. 1. Washington, D.C. : International Monetary Fund, 1963. 1 online resource (230 pages) IMF Staff Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students This paper discusses effects of inflation on economic development. A mild inflation may well encourage little, or no, evasion of the 'inflation tax.' On the other hand, a strong inflation, and frequently a mild one also, will lead to community reactions which have effects like those of widespread tax evasion. A development policy may have wider aims than the encouragement of a high level of investment. Inflation has two effects on the desire for liquidity, which are related to the two basic reasons why individuals and businesses wish to hold liquid assets-the speculative and precautionary motives. Inflation increases the value of effective liquidity, thereby raising the community's desire for it, but it makes the most generally accepted store of liquidity unacceptable sources of protection. The control of inflation is only one of the problems facing a government wishing to encourage rapid economic development. The fight against illiteracy, the reform of bureaucratic practices, the building of basic sanitary facilities for the eradication of endemic diseases, the substitution of competitive for monopolistic trade practices, the encouragement of a widespread spirit of entrepreneurship, and the creation of an adequate amount of social capital, may be important prerequisites for rapid growth. Mode of access: Internet IMF Staff Papers; IMF Staff Papers ; No. 1963/001 Full text available on IMF http://elibrary.imf.org/view/journals/024/1963/001/024.1963.issue-001-en.xml IMF e-Library