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To: Berney who wrote (125094)	10/17/2005 7:40:29 AM
From: Moominoid	Respond to of 209892

I would define inflation as an increase in the general price level of the economy (though we can talk about inflation in some sectors as well). It could have different causes driving it. In the end monetary policy has to accomodate it in standard macro theories but that is an explanatory theory rather than a definition IMO.

To: Berney who wrote (125094)	10/17/2005 10:39:12 PM
From: skinowski	Respond to of 209892

My old Webster's dictionary had only one definition for inflation: An increase in the supply of money followed by an increase in the cost of goods & services. Google search for "inflation definition" brings back over 5 1/2 million items. Many people seem to be struggling with these issues. google.com One of them seems to have some sharp sounding definitions: "In economics, inflation is an increase in the general level of prices of a given kind. General inflation is a fall in the market value or purchasing power of money within an economy, as opposed to currency devaluation which is the fall of the market value of a currency between economies. General inflation is referred to as a rise in the general level of prices. The former applies to the value of the currency within the national region of use, whereas the latter applies to the external value on international markets. The extent to which these two phenomena are related is open to economic debate. Inflation is the opposite of deflation. Zero or very low positive inflation is called price stability. In some contexts the word "inflation" is used to mean an increase in the money supply, which is sometimes seen as the cause of price increases. Some economists (of the Austrian school) still prefer this meaning of the term, rather than to mean the price increases themselves" encyclopedia.laborlawtalk.com