Is inflation inevitable in all successful economies? Throughout history, has there ever been a society that maintained 0% inflation for a long term while still maintaining a good quality of life?
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Societies don’t want 0% inflation, they want at least a small amount…
Having some inflation incentivizes people to do something with their money — either spend it or invest it. They buy today for fear prices might increase in the future as consumer spending is important for economic growth. Or they invest it so that it grows, which provides capital individuals and businesses need to buy homes, grow their businesses, etc.
Also, you don’t want disinflation, where prices fall, which causes people to sit on their money waiting for addition price drops, don’t feel compelled to invest, etc. So most governments shoot for 2-3% inflation as the sweet spot.
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