Great Inflation
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The Great Inflation was a prolonged period of unusually high and volatile inflation in the United States during the late 1960s through the early 1980s, driven by expansionary policies and supply shocks, that fundamentally reshaped modern monetary policy.
Aliases (1)
Statements (50)
| Predicate | Object |
|---|---|
| instanceOf |
economic period
→
historical inflation episode → macroeconomic event → |
| alsoKnownAs |
Great American Inflation
→
|
| cause |
1973 oil crisis
→
1979 energy crisis → Great Society programs spending → Nixon shock → Vietnam War spending → accommodative monetary policy → breakdown of Bretton Woods system → cost-push inflation → demand-pull inflation → expansionary fiscal policy → expansionary monetary policy → oil price shocks → supply shocks → wage-price spirals → |
| characteristic |
high inflation
→
stagflation → volatile inflation → |
| country |
United States
→
|
| endTime |
early 1980s
→
|
| field |
macroeconomics
→
monetary economics → |
| followedBy |
Great Moderation
→
|
| influencedBy |
Keynesian economic policies
→
Phillips curve framework → accommodation of supply shocks by monetary policy → fiscal deficits → political pressure for low unemployment → |
| location |
United States economy
→
|
| mainImpact |
adoption of Volcker disinflation policies
→
adoption of Volcker rule of tight money to fight inflation → changes in monetary policy framework → changes in wage bargaining institutions → development of modern central bank independence norms → erosion of real wages → greater emphasis on inflation control → greater focus on expectations in macroeconomics → higher nominal interest rates → increased macroeconomic volatility → increased use of indexation in contracts → loss of credibility for the Federal Reserve → rise in inflation expectations → rise in unemployment during disinflation → shift toward monetarist ideas → |
| precededBy |
postwar economic boom in the United States
→
|
| startTime |
late 1960s
→
|
| timePeriod |
20th century
→
|
Referenced by (3)
| Subject (surface form when different) | Predicate |
|---|---|
|
Great Inflation
("Great American Inflation")
→
|
alsoKnownAs |
|
Great Moderation
→
|
contrastedWith |
|
Volcker shock
→
|
precededBy |