Sentences with phrase «causes stagflation»

People can't agree on what causes stagflation but the two main theories are a supply shock (usually oil) or poorly made economic policy.

Not exact matches

The emergence of such «stagflation» in the late 1970s [13] led to general acceptance of the natural - rate hypothesis, the idea that abnormally low unemployment causes inflation to accelerate.

Phase 4: Stagflation phase: GDP growth slows but inflation remains high (side note: most bear markets are preceded by a 100 % + increase in the price of oil which drives inflation up and causes central banks to tighten).

For example, the double - digit inflation of the 1970's was caused by banks keeping interest rates low in an attempt to stimulate a weak economy, at a time when imported inflation from the oil shock was high (leading to stagflation).