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Inflation rates among members of the International Monetary Fund in April 2024 UK and US monthly inflation rates from January 1989 [1] [2] In economics, inflation is a general increase in the prices of goods and services in an economy. This is usually measured using a consumer price index (CPI).
Part of this stems from the argument that extra spending on interest payments on government debt is in and of itself inflationary. [5] John Cochrane argues that the key factor in when inflation gets out of control is when people lose confidence that a nation's debt will be repaid, and thus start to expect and prepare for inflation. [1]
Because of the dangers of inflationary bias, several measures have been suggested to prevent it. Kenneth Rogoff proposed that states should have conservative central bankers, [2] whilst others have suggested that states should create inflationary goals, and if this inflation rate is exceeded, there should be some form of punishment for the central banker.
An increase in government spending is one of the factors that economists say can drive inflation. Other factors include interest rates, monetary policy, supply chain disruptions and fluctuations ...
1. Inflation. Inflation occurs when the cost of goods and services increases, decreasing the purchasing power (and actual value) of a currency. Typically, the perceived value of the money will ...
Monetary inflation is a sustained increase in the money supply of a country (or currency area). Depending on many factors, especially public expectations, the fundamental state and development of the economy, and the transmission mechanism, it is likely to result in price inflation, which is usually just called "inflation", which is a rise in the general level of prices of goods and services.
As Newsweek reported, a recent poll indicated that almost two-thirds of Americans are in favor of the federal government providing additional stimulus checks to help them combat inflation.
The concept of core inflation as aggregate price growth excluding food and energy was introduced in a 1975 paper by Robert J. Gordon. [1] This is the definition of "core inflation" most used for political purposes. The core inflation model was subsequently developed and advocated by Otto Eckstein, in a paper published in 1981. [2]