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2 days ago · So-called demand-pull inflation may be caused by increases in aggregate demand due to increased private and government spending, etc. Conversely, negative demand shocks may be caused by contractionary economic policy. Supply shocks may also lead to both higher or lower inflation, depending on the character of the shock.
- Inflation (Disambiguation)
Business and economics. Job title inflation; Monetary...
- Money Supply
The public's demand for currency and bank deposits and...
- Inflation (Disambiguation)
1 day ago · The Great Depression (1929–1939) was a severe global economic downturn that affected many countries across the world. It became evident after a sharp decline in stock prices in the United States, leading to a period of economic depression. [1] The economic contagion began around September 1929 and led to the Wall Street stock market crash of ...
3 days ago · In economics, hyperinflation is a very high and typically accelerating inflation. It quickly erodes the real value of the local currency, as the prices of all goods increase. This causes people to minimize their holdings in that currency as they usually switch to more stable foreign currencies. [1] When measured in stable foreign currencies ...
Apr 25, 2024 · The economy has been hit by severe real shocks. The pandemic raised the global demand for goods and reduced their supply; Russia has cut back severely its supply of gas to Europe. These have had dramatic effects on relative prices (Chart 12 shows the dispersion of inflation rates across the components of the CPI).
Apr 25, 2024 · A positive demand shock lifts both equity and non-energy commodity prices, while a negative shock to the supply of commodities raises non-energy commodity prices but depresses equity prices. The intuition here is that in response to a negative supply shock a commodity’s price increases, making businesses in other sectors less profitable, and ...
Apr 15, 2024 · Downward Price Rigidities and Inflationary Relative Demand Shocks. We show that a negative relative demand shock in a sector with downwardly rigid prices, like the service sector, can generate substantial inflation. Such a shock induces an equilibrium decline in the relative price of services. If price adjustment costs are non-existent or ...
Apr 15, 2024 · To illustrate the relevance of this mechanism in practice we provide evidence on the downward rigidity of person-to-person service prices during the Covid pandemic of 2020-2021. We then introduce downward price rigidities in a multisector New-Keynesian model and show how they can result in inflationary relative demand shocks.
