Inflation [antikvár]

Introduction The concept of inflation has undergone considérable modification since it was first treated by the neo-classical economists. To them inflation usually meant what we would today describe as hyperinflation, or a complété loss of confidence in the currency result-ing in astronomical price rises and perhaps complété monetary collapse. It was, of course, recognized that fluctuations in trade would be expected to be accompanied by fluctuations in prices. Indeed rising prices were thought of as a sign of good times and falling prices as signs of poor trade and poor profits. But these reflected movements and adjustments are to be expected in the normal course of business. Inflation, however, was regarded as a destroying disease born out of lack of monetary control whose results undermined the rules of business, creating havoc in mar-kets and the financial ruin of even the prudent. Since the Second World War, however, the western industrial world has witnessed an almost unbroken rise in prices and money incomes. AH this has been achieved without major panics or, to date at least, without the érosion of the rules under which the business game is played. Prices have not shown the signs of galloping away that we associate with hyperinflation but have grown steadily with some interruptions associated with variations in the pressure of demand. Indeed the experience of the period from the beginning of the Second World War to the late forties is nicely described by the title of A. J. Brown's book on the period, The Great Inflation. Since that time we have been accustomed to what is now sometimes described as creeping inflation. It would not be strictly accurate to say that the concept of inflation has changed over the last forty years, but rather that many economists would now argue there are several différent strains of the disease. We are no longer confined to the wild feverish strain of hyperinflation, but constantly experience the slow, strength-sapping qualifies of the creeping variety. There are, however, those who still maintain a unity of diagnosis in these matters and argue that rising prices can always be traced to a