Examples of deflationary spiral in the following topics:
-
- This cycle of continuing inflation is called a deflationary spiral.
-
- It can replace money as the method of exchange in times of monetary crisis, such as when a the currency is either unstable (e.g. hyperinflation or deflationary spiral) or simply unavailable for conducting commerce.
-
- Deflation is a problem in a modern economy because it increases the real value of debt and may aggravate recessions and lead to a deflationary spiral.
-
- Specifically, cutting wages reduces spending and may result in a downwards spiral.
- This can be another spiraling issue, as money not being exchanged is actively reducing prospective employment, revenues, and future investments.
- Consider the unemployment and excessive savings problems, and how they stand to lead to spiraling decline.
- The other side of that coin is that positive economic situations can spiral upwards.
-
- Banks, consumers, and the government all contributed to improper borrowing and lending, which in turn created a downward spiraling economy.
-
- In many ways, what Pigou is putting forward is the idea that downwards spiral on the IS-LM model , as predicted by Keynes due to deflation, will be counterbalanced by an increase in real wages and thus an increase in expenditure.
- The analysis of interest rates displayed above, through the wealth effect in particular, offsets the negative spiral that could occur as a result of deflation and decreased employment.
-
- Asymmetric information starts the downward economic spiral for a firm.
-
- This increased demand pushed up prices, leading to demands for higher wages, which pushed prices higher still in a continuing upward spiral.
-
- High levels of inflation eat away at savings, increase menu costs and shoe-leather costs, discourage lending, and may create an inflationary spiral that leads to hyperinflation.
-
- As more companies went bankrupt, he argued, more people would lose their jobs, making income fall further and leading yet more companies to fail in a frightening downward spiral.