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I don't understand your reasoning, how does the rise of the corporate sector in developing nations put deflationary pressure on developed countries? Wouldn't co
by SuoDuanDao 6y ago
I don't understand your reasoning, how does the rise of the corporate sector in developing nations put deflationary pressure on developed countries? Wouldn't competition from new economic centres dilute the value of development in Western countries thereby causing inflationary pressure?
- ayo4yayo 6y agoTheir point is that even if wages go down workers are able to move to cheaper areas.
- sand_castles 6y agodeflationary / inflationary have precise meaning in macroeconomics. when JPow says deflationary, what he means is general fall in demand. It could "look" inflationary to a wage earner, if he loses his job, his saving account returns 1%, and the cost of products spiral out of control ( causing a fall in demand from JPow's perspective ). inflationary conditions like those in the 1970s are unlikely as most countries are quite developed these days, and general increase in price in developed countries doesn't mean prices are increasing everywhere for all products.