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This paper discusses how there is no generally accepted theory of inflation and how the causes that generate it are numerous and include economic, psychological, social, political, internal, and external factors. The paper also examines how inflation is based on numerous partial causes, which correlated determine the inflationist process.
From the Paper:"The inflation through costs is based on the connections that exist at costs level, the behavior of entrepreneurs, and the efficiency of using resources. The working hypothesis is that the level of unitary costs receives a growth impulse. The causes are numerous: depreciation of the rate exchange, which increases the prices of imported production factors, favoring the CPI increase, the reduction of certain markets.
Inflation through costs can also emerge because of governmental policies, when the government is interested in maintaining a high demand, by practicing expansive monetary and fiscal policies. This way, the global demand that is artificially supported by the authorities, increases potential production, which leads to inflationist reactions of entrepreneurs."
Sample of Sources Used:
- Inflation (2008). Webster's Online Dictionary. Retrieved December 5, 2008 from http://www.websters-online-dictionary.org/definition/inflation.
- Inflation (2008). The American Heritage Dictionary of the English Language. Fourth Edition. Retrieved December 5, 2008 from http://www.bartleby.com/61/14/I0131400.html.
- Inflation (2008). InvestorWords. Retrieved December 6, 2008 from http://www.investorwords.com/2452/inflation.html.
- Consumer Price Index (2008). Bureau of Labor Statistics. Retrieved December 6, 2008 from http://www.bls.gov/cpi/.
- Bryan, Michael F. (1997). On the Origin and Evolution of the Word Inflation. Federal Reserve Bank of Cleveland. Retrieved December 6, 2008 from http://www.clevelandfed.org/research/Commentary/1997/1015.pdf.
Cite this Term Paper:
Inflation (2010, November 01) Retrieved November 19, 2019, from https://www.academon.com/term-paper/inflation-145287/
"Inflation" 01 November 2010. Web. 19 November. 2019. <https://www.academon.com/term-paper/inflation-145287/>