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> When there's a steep inflation, be it anything from Turkey level to Venezuela level inflation, your salary gets adjusted to sustain your lifestyle Only at th
by ptero 6y ago
> When there's a steep inflation, be it anything from Turkey level to Venezuela level inflation, your salary gets adjusted to sustain your lifestyle
Only at the lowest levels, where it has no relation to economics anyway: most governments will work to ensure that poor who have nothing to lose will not be pushed into long-term hunger; if they do, they revolt. So either the costs of the food and barebones medical care (broken bones, etc.) will be subsidized for them or the money will be bumped up.
There is a second group where this adjustment is likely to happen: Army and government workers. If you starve those, you quickly feel it. Everyone else gets to fend for themselves and is usually much, much worse off. I have also lived in a country going through hyperinflation and unless one is in a select group (likely linked to organized crime) one definitely does not get salary adjusted to sustain the lifestyle. In fact, the lifestyle one had usually crumbles. My 2c.
- mrtksn 6y agoYou are right but probably in your case there's a second component: Economy crumbling due to political instability or something of that sort. Extreme inflation is not the same as the inflation we see in the western countries, it is usually accompanied with some turmoil therefore the salaries do get adjusted but they get adjusted beneath the inflation as the economy gets smaller. Once the stability is achieved, you can end up with an order of magnitude higher inflation that the rich western countries but have noticeable increase from year to year in terns of quality of life and access to import goods. Probably my claims don't cover any case of hyperinflation because that always comes with other problems too, therefore you probably don't have a healthy economy in hyperinflation.