What is stagflation?

Stagflation is an economic trend in which inflation and unemployment grow, while the general economic growth is slow. This trend can be difficult, as focusing on one aspect of the problem can worsen other aspects. Many governments seek to avoid stagflation through fiscal policy by promoting even and healthy growth and trying to prevent inflation. If the condition continues long enough, it will cause the economic recession and final self -ORIZATION. During this period, several other nations, including the United Kingdom, experienced high oil prices to general inflation, while employment and domestic economy remained slow. In the United States, the federal reserve bank eventually entered, frozen money supply and triggered a recession.

The word is Portmanteau "Stagnation" D "Inflation" and seems to have been created in 1965 by a member of the Conservative Party in Britain. For the first time he mentioned the stagflation in the speech of the House on 17 November and discussed the unique situation in which BR wasIts economy. When the problem spread to other nations, the use of the term has expanded because it was a convenient shortcut to describe a serious problem.

The causes of stagflation are widely discussed. Some economists believe that, for example, excessive government regulation contributes to this. Others believe it can be caused by external events, such as a sudden climb of the price of commodity, such as oil; This is known as shock theory. Whatever the cause, stagflation can correct hard work and it may be difficult to go such a period.

In the case of the 1970s. In the 80s of the 20th century, several measures were used to support economic growth, which also helped the nation to recover from the stagflation period. Consumers can very much during such a timesuffer because they consider goods and services too expensive while they cannot get jobs to pay for basic needs. Since the government can reduce the availability of loans in an effort to fight the situation, consumers may have to drastically reduce their budgets to survive.