== == As a disclaimer, the following paragraph is not supported by most economists. Most economists would suggest that the Federal Reserve might have helped it along but was far from actually causing inflation. Also, the question relates to how a student of management would look at the problem of inflation, not the causes of inflation.
Inflation in the United States is a result of money management policies instituted by the Federal Reserve. This was obvious to the opponents of the Federal Reserve in the 1913 Congress. The Federal Reserve Act was passed in a rush session of Congress just before they left on Christmans break, December 13, 1913. Representative Guernsey of Maine, a Republican on the House Banking and Currency Committee, said "This is an inflation bill, the only question being the extent of the inflation." In:http://wiki.answers.com/Q/FAQ/1786 Demand side factors: 1- Increase in nominal money supply: Increase in nominal money supply without corresponding increase in output increases the aggregate demand. The higher the money supply the higher will be the inflation. 2- Increase in disposable income: When the disposable income of the people increases, their demand for goods and services also increases. 3- Expansion of Credit: When there's expansion in credit beyond the safe limits, it creates increase in money supply, which causes the increased demand for goods and services in the economy. This phenomenon is also known as 'credit-induced inflation'. 4- Deficit Financing Policy: Deficit financing raises aggregate demand in relation to the aggregate supply. This phenomenon is known as 'deficit financing-induced inflation'. 5- Black money spending: People having black money spend money lavishly, which increases the demand un-necessarily, while supply remains unchanged and prices go up. 6- Repayment of Public Debts: When government repays the internal debts it increases the money supply which pushes the aggregate demand. 7- Expansion of the Private Sector: Private sector comes with huge capitals and creates employment opportunities, resulting in increased income which furthers the increase in demand for goods and services. 8- Increasing Public Expenditures: Non developmental expenditures of government lead to raise aggregate demand which results as increased demand for factors of production and then increased prices. Supply side factors 1- Shortage of factors of production or inputs: Shortage of factors of production, i.e. raw material, labour capital etc causes the reduced production, which causes the increase in prices. 2- Industrial Disputes: When industrial disputes come to happen, i.e. trade unions resort strikes or employers decide lock outs etc the industrial production reduces. And as a short supply of goods in the market the prices go up. 3- Natural Calamities: Natural disasters, invasions, diseases etc effect the agricultural production, and shortage of supply which furthers the rise in prices. 4- Artificial Scarcities: Hoarders, black marketers and speculators etc create artificial shortage to earn more profits by keeping the prices high. (in Pakistan bird flu dilemma and sugar crises are the major examples in this regard) 5- Increase in exports (excess exports): When the country has tends to earn maximum foreign exchange and exports more and more without considering the domestic use of the commodities, it creates a shortage of commodities at home which increases the prices. (With reference to Pakistan, the failure of export bonus scheme during 1950's is the most common example of this type of cause of inflation) 6- Global factors: This factor includes the changing global environment. Most common example is the rise in oil prices. This factor of inflation may vary in nature, i.e. it can be political, strategic, economic or logistic in nature. 7- Neglecting the production of consumer goods: When the production of consumer goods is neglected with reference to the increased production of luxuries, it also creates inflation. For example in Pakistan, in last couple of years our services sector has grown with the highest rate of 8.8% (mainly telecom sector), while basic necessities have been ignored which created increase in the prices of consumer goods. 8- Application of law of diminishing returns: this law applies when the industries use old machines and methods and, which increase in cost by increasing the scale of production. This furthers the increase in prices and hence inflation bursts out.
factors responsible for inflaction
We were on the gold standard then. No fiat currencyhttp://inflationdata.com/inflation/images/charts/Annual_Inflation/inflation_Cumulative.htmI don't think there was much inflation after the depression. During the depression there was deflation. The economy recovered slowly so there was no spike in inflation.
Inflation was the same thing back then as it is now. Inflation rates were and are different in different countries, so the amount of inflation in each country is always different, depending on the solidity of the local currency. In Britain the inflation rate in 1900 was 4.5%. In the USA it was 16.9% but then fell to -2.4 the next year. Inflation rates in the US changed greatly from year to year and were often double-digit (but sometimes that was double-digit deflation)
Inflation caused Congress to stop issuing paper money.
It never really spoke of the actual issue of inflation, but it did allow the states AND the central government to print money. This caused confusion and a high inflation since there were over 20 forms of currency circulating the U.S.
Inflation is the constant rise in the general price level. Inflation is the constant rise in the general price level.
When inflation goes up and now your rent has increased and so has everything that you
Lynn A. Bace has written: 'Coping with inflation' -- subject(s): Case studies, Effect of inflation on, Industrial management, Inflation (Finance)
Inflation can be a result of economic development, national debt, unemployment, production cost, and international lending.
the federal reserve board
What_is_inflation_on_working_capitalimpact of inflation onworkingcapital
David Voda has written: 'Inflation-proof your portfolio' -- subject(s): Inflation (Finance), Business cycles, Investments, Portfolio management
producers raise prices to meet increased costs
The larger the deficit the more inflation there will be. The government will print more money in the hopes of being able to get out of the deficit easier.
Excessive wage demands lead to price hikes that result in inflation
Nii Kwaku Sowa has written: 'Policy consistency and inflation in Ghana' -- subject(s): Inflation (Finance), Fiscal policy 'Inflation management in Ghana' -- subject(s): Inflation (Finance), Monetary policy 'Impact of liberalization on key markets in sub-Saharan Africa' -- subject(s): Economic policy, Free enterprise, Free trade, Structural adjustment (Economic policy) 'The wider macroeconomic implications of fiscal policy' -- subject(s): Deficit financing, Fiscal policy 'Inflation, interest rates, and banking in Ghana' -- subject(s): Effect of inflation on, Banks and banking, Interest rates 'Macroeconomic management and exchange rate policies in Ghana' -- subject(s): Foreign exchange rates, Monetary policy
Hitler felt that Jews were responsible for the inflation that followed after ww 1. And that Jews were taking jobs away from germans
inflation