Can someone explain why we have it and what good it does?
The one definite I can see is it keeps prices rising so if you have nothing it always gets harder to catch up. Is it just to keep the poor struggling?
Inflation
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Quickenthetempo
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CleggHall
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Re: Inflation
Inflation occurs when Aggregate Demand exceeds Aggregate Supply in the economy thus all prices rise. Increasing interest rates may arrest the Demand growth since some people may decide to Save rather than Spend if returns for saving improve.
In general Inflation is not good since wage demands are likely to rise in response to falling real incomes, firms' costs rise, profits fall and UK industry becomes internationally uncompetitive and the country sucks in imports.
Disadvantaged people with few assets continue to struggle as house prices rise and they cannot get on the housing ladder.
A simple starter for the debate to come, other economists on the board can have a try at answering your very difficult questions.
In general Inflation is not good since wage demands are likely to rise in response to falling real incomes, firms' costs rise, profits fall and UK industry becomes internationally uncompetitive and the country sucks in imports.
Disadvantaged people with few assets continue to struggle as house prices rise and they cannot get on the housing ladder.
A simple starter for the debate to come, other economists on the board can have a try at answering your very difficult questions.
This user liked this post: Quickenthetempo