Re: RE: Re: RE: Re: Re: Re: Re: Current (heterodox) thi nkingoni nterestrates?

[Jim Devine <jdevine@xxxxxxxxxxxxxxx>]

At 07:32 PM 4/6/00 -0400, you wrote:
> I was playing with words, but also was thinking that disinflation was only
> a situation of low inflation, not necessarily linked to low unemployment,
> given that the neoclassical explanation would suggest that low
> unemployment rates signal wage pressure thus 'fueling' inflation.

the way I understood it, disinflation refers to the decline in persistent,
built-in, inflation that is very difficult to get rid of in a year via
recessionary policies. Persistent recessions (like the early 1980s) and
persistent declines in oil prices help lead to disinflation. So would
increasing worker insecurity, which would give any given unemployment more
power to deter inflation. So we might see an association between lower
unemployment (which has more impact because of insecurity) and lower
inflation. I think that's part of what's happened.

> I think it's time to go home here in the Eastern Time Zone.

good idea. I should too.

Jim Devine jdevine@xxxxxxx &  http://liberalarts.lmu.edu/~jdevine