That is an extremely simplified take of what inflation is.
Here’s a fun example as to why just saying “inflation means prices go up” doesn’t make sense, what happens when a group of companies conspire to raise prices simultaneously? Is that inflation or is that price fixing?
https://www.propublica.org/article/yieldstar-rent-increase-realpage-rent
I’m not saying “inflation means prices go up” I’m saying “inflation means prices went up”. There can be many things that cause prices to go up, inflation is one result of any such cause and of course then causes many things itself including further inflation.
In your scenario that’s inflation caused by price fixing. You seem to be saying these things are mutually exclusive but I don’t understand why you would say that.
I suppose my point is if we put any cause of rising prices under the “inflation” umbrella, it gives people the wrong idea as to the cause. Rather then just specifying what is causing prices to rise, people just say “it’s inflation.”
Inflation is defined as the increase of prices over a set period of time. It is in itself nothing, doesn’t do anything and its singular purpose is to be able to say how much something costs today compared to yesteryear.
If the price difference depends on a supply chock (something that affects the ability to produce, like a shortage), or a demand chock (suddenly everbody rejects Tesla) is all the same, it results in a price change and can therefore be compared using the measure inflation.
Companies deciding to raise prices (for any reason — justified or not) is what inflation is made of.
Inflation just means “prices went up.”
That is an extremely simplified take of what inflation is.
Here’s a fun example as to why just saying “inflation means prices go up” doesn’t make sense, what happens when a group of companies conspire to raise prices simultaneously? Is that inflation or is that price fixing? https://www.propublica.org/article/yieldstar-rent-increase-realpage-rent
I’m not saying “inflation means prices go up” I’m saying “inflation means prices went up”. There can be many things that cause prices to go up, inflation is one result of any such cause and of course then causes many things itself including further inflation.
In your scenario that’s inflation caused by price fixing. You seem to be saying these things are mutually exclusive but I don’t understand why you would say that.
I suppose my point is if we put any cause of rising prices under the “inflation” umbrella, it gives people the wrong idea as to the cause. Rather then just specifying what is causing prices to rise, people just say “it’s inflation.”
Inflation is defined as the increase of prices over a set period of time. It is in itself nothing, doesn’t do anything and its singular purpose is to be able to say how much something costs today compared to yesteryear. If the price difference depends on a supply chock (something that affects the ability to produce, like a shortage), or a demand chock (suddenly everbody rejects Tesla) is all the same, it results in a price change and can therefore be compared using the measure inflation.
Fair enough