Contents lists available at ScienceDirect Annals of Agrarian Science journal homepage: www.elsevier.com/locate/aasci Agflation and other modifications of inflation (the cases of Georgia and its neighboring countries) Vakhtang Charaia a , Vladimer Papava b,* a Business and Technology University, 82, Ivane Chavchavadze Ave., Tbilisi, 0162, Georgia b Ivane Javakhishvili Tbilisi State University, 1, Ivane Chavchavadze Ave., Tbilisi, 0179, Georgia ARTICLE INFO Keywords: Agflation Inflation Food inflation Imflation Munflation Poverty ABSTRACT The article explores the agflation index and other modifications of the inflation index using examples from Georgia and its neighboring countries. The findings showed that a traditional inflation index fails to fully reflect the problems caused by price changes, especially for poorer populations in developing countries. Therefore, new instruments need to be identified. The article suggests using the munflation index for observing changes in prices. The munflation index consists of agflation, utilities expenses and health care expenses incurred. The article shows that applying the munflation instrument along with the inflation index allows us to have a clearer picture. These indices do not exclude but complement each other. Introduction According to the World Bank 10.7% (approximately 800 million people) of the world's population spend less than USD 1.9 a day [1]. Notwithstanding the quite meager index, it is to be noted that the same index amounted to 12.7% in 2011 and it was 44% in 1981 [2]. Ac- cording to a study carried out by the Food and Agricultural Organiza- tion of the United Nations, 791 million people were chronically hungry [3]. Poverty is one of the most acute issues for 30% of the Georgian population [4]. The study's findings clearly show that it is necessary to raise the living standards of the world's population, especially in developing countries. In this regard, it is vital to evaluate how inflation; particu- larly, agrarian inflation or agflation, impacts the population of these countries. The goal of the study is to evaluate the impact of inflation and its components on common citizens in Georgia and in some developing countries. Inflation and developing countries National statistical services in various countries have been carrying out observations on inflation for decades. Specifically, the National Statistics Office of Georgia carries out similar observations of 1700 entities across the country and analyzes the information obtained and publishes it on a monthly basis [5]. From the point of view of statistics, the methodology is quite correct although we should keep in mind that, unfortunately, the consumer basket, according to which the above in- flation is calculated, does not reflect key issues for the citizenry, espe- cially for poorer citizens in developing countries. This is due to the fact that the main interests of the population are oriented only on the changes in prices of several groups of commodities and services and not on all of the components of the consumer basket. Regretfully, an official inflation index and developing a relevant policy based on it oftentimes, due to the above reasons, cause dis- satisfaction among the populations of many countries worldwide, especially in developing countries. New instruments In order to obtain more or less adequate information about price levels and make objective and realistic conclusions based on them, the government of a country and its central bank cannot be circumscribed only by the inflation index. For those countries where imported products make up a significant part of the consumer basket, our proposal is to introduce an imflation index (the term is derived from combining two terms: import and in- flation) [6]. Introducing an imflation index (i.e., the average price level only for imported goods) will make the government and the central bank pay attention not only to a generalized index of increased prices but also analyze the price increases due to import which is of vital importance for both common citizens as well as businesses [7]. https://doi.org/10.1016/j.aasci.2018.04.007 Peer review under responsibility of Journal Annals of Agrarian Science. * Corresponding author. E-mail address: vladimer.papava@tsu.ge (V. Papava). Annals of Agrarian Science 16 (2018) 201–205 Available online 22 April 2018 1512-1887/ © 2018 Agricultural University of Georgia. Published by Elsevier B.V. This is an open access article under the CC BY-NC-ND license (http://creativecommons.org/licenses/BY-NC-ND/4.0/). T