A situation in which real interest rate cannot be reduced by any action of the monetary authorities. This is liable to arise if prices are expected to fall. If general price falls are expected, holding money will produce an expected real gain equal to minus the expected rate of inflation. The real interest rate cannot be reduced beyond the point at which the nominal interest rate falls to zero, however much the money supply is increased. The monetary authorities are thus unable to promote investment by cutting real interest rates, even if investment would be responsive to a real interest rate cut if one should occur.

• imperfect competition
• imperialism, economic
• implicit contract
• implicit function
• importables
• import control
• import deposit
• Import Duties Act, 1932
• import duty
• imported inflation
• import levy
• import licence
• import penetration
• import propensity
• import quota
• import restriction
• imports
• import substitution
• import surcharge
• import tariff
• imputation system
• imputed charge for consumption of non-trading capital
• imputed income
• IMRO
• incentive-compatibility