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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.

Bank deposits --- Banking --- Banks and Banking --- Banks and banking --- Banks --- Currencies --- Deflation --- Depository Institutions --- Exports and Imports --- Exports --- Finance --- Financial services --- Government and the Monetary System --- Imports --- Inflation --- International economics --- International Trade Organizations --- International trade --- Macroeconomics --- Micro Finance Institutions --- Monetary economics --- Monetary Systems --- Money and Monetary Policy --- Money --- Mortgages --- Payment Systems --- Price Level --- Prices --- Regimes --- Standards --- Trade Policy --- Trade: General --- United States

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This paper explains the features of the Communaute Financiere Africaine (CFA) Franc system. All CFA countries belong to one of three monetary systems. Although their statutes and functions differ somewhat, the three central banks have various common features. All three central banks are authorized to extend short-term and medium-term credit to the private sector. Many the commercial banks operating in the CFA countries are French banks with head offices in Paris. The credit operations of the commercial banks in the CFA countries are largely dependent upon the rediscount facilities offered by the central banks. The Bank is the sole authority for issuing CFA currency in the countries of French Equatorial Africa and in Cameroon. The exchange regulations applied in the CFA countries are patterned on those of France, with adaptations decided upon by local authorities according to local conditions and requirements. While exchange transactions with the other franc area countries generally are free, those with the non-franc area are subject to licensing.

Agricultural commodities --- Agriculture: General --- Banking --- Banks and Banking --- Banks and banking --- Banks --- Commodities --- Credit --- Currencies --- Currency --- Depository Institutions --- Economic Development: Urban, Rural, Regional, and Transportation Analysis --- Exports and Imports --- Exports --- Farm produce --- Foreign Exchange --- Foreign exchange --- Housing --- Infrastructure --- International economics --- International trade --- Investment & securities --- Investments: Commodities --- Macroeconomics --- Micro Finance Institutions --- Monetary economics --- Monetary Policy, Central Banking, and the Supply of Money and Credit: General --- Money and Monetary Policy --- Money --- Mortgages --- National accounts --- Saving and investment --- Trade: General --- United States