ABSTRACT

The rulers of Communist Poland have experienced riots and insurrections because of higher food prices, due in part to additional exports. A US president managed to avert an inflationary threat, which had been puffed up by massive exports of staple commodities, and no blood flowed into the Potomac. The existence of a link between inflation and exporting has been recognised for hundreds of years. Inflation-conscious English politicians sponsored the 1774 Act which, explicitly, prescribed that exports were not to be subsidised unless low prices prevailed at home. The political need to pacify the mass of ordinary people, by raising their standard of living through access to cheap consumer goods, was recognised in the highest quarters. It brought about administrative directions to certain enterprises not to maximise exports but to assign a larger proportion of their output to domestic customers. Brazil is renowned for the many contractual agreements, linked to the cost-of-living index, which lord over its economy.