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RE: Does Deflation Spur Consumption? (Contrary to conventional Wisdom)

in #economics8 years ago

It's awesome people are waking up to the crazy argument that slyly forcing people to spend will somehow make society richer. The underlying rationale is childish and forcing people to consume more than they'd prefer today means they have less to do so tomorrow. The magical wealth gains offsetting this obvious loss are dubious at best.

I'm of the camp that mild deflation is natural in an increasingly productive world and also beneficial in that it gradually increases purchasing power. That said, I'm skeptical of flipping the inflation argument and being pro-deflation.

"As much as mainstream economists like to promote the supposed societal benefits of increasing spending, living breathing people need to save." Absolutely! And they also need to consume, the split best left to individuals to decide.

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