Odd Lots Isabella Weber on the Big Rethink of Inflation
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Jun 8, 2023 Isabella Weber, an Economics professor at UMass Amherst, dives into the evolving concept of inflation, introducing her research on 'sellers' inflation' which examines how corporations exploit market disruptions to raise prices. She discusses the shift in public perception towards inflation, the impact of corporate pricing strategies, and explores concepts like 'greedflation'. The conversation also touches on potential solutions like windfall profits taxes and contrasts inflation trends between the West and China, shedding light on the complex dynamics shaping today's economy.
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Inflation Drivers
- Different factors drive inflation, like tight labor markets and supply chain issues.
- Correctly identifying these causes is crucial for effective policy responses.
Sellers' Inflation vs. Greedflation
- "Sellers' inflation" differs from traditional "greedflation."
- It suggests that emergencies create conditions for coordinated price hikes, not increased greed.
Price Hikes and Consumer Behavior
- Companies raise prices to protect profit margins, especially during cost shocks.
- Consumers accept price hikes more readily if there's a perceived legitimate reason.