STAGFLATIONARY Meaning and
Definition
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Stagflationary is an adjective used to describe a particular economic condition characterized by a combination of stagnant economic growth or recession, high unemployment rates, and rapid inflation. This term is derived from a fusion of two words - "stagnant" and "inflationary."
When an economy is stagflationary, it faces the challenging scenario of stagnant or very slow economic growth, resulting in job scarcity and high unemployment rates. Concurrently, inflation rates soar at an alarming pace, causing a sharp rise in the overall price level of goods and services. This condition is a cause of great concern for policymakers and economists as it presents a unique challenge. In normal circumstances, there is an inverse relationship between inflation and unemployment, known as the Phillips curve. However, in a stagflationary environment, both inflation and unemployment coexist at high levels, defying this traditional economic understanding.
Stagflationary conditions often emerge due to a variety of factors, including supply-side shocks, such as sudden increases in commodity prices or disruptions in the production process. These shocks can disrupt the normal functioning of an economy, leading to a decline in output and job losses. Simultaneously, increased production costs and limited supply push up prices, leading to inflationary pressures. Monetary and fiscal policies are typically implemented to address stagflation, although finding effective solutions can be challenging due to the complex nature of the problem.
Overall, stagflationary refers to an economic environment characterized by stagnant growth, high unemployment, and accelerating inflation, challenging policymakers and economists to combat this unique economic conundrum.
Common Misspellings for STAGFLATIONARY
- atagflationary
- ztagflationary
- xtagflationary
- dtagflationary
- etagflationary
- wtagflationary
- sragflationary
- sfagflationary
- sgagflationary
- syagflationary
- s6agflationary
- s5agflationary
- stzgflationary
- stsgflationary
- stwgflationary
- stqgflationary
- stafflationary
- stavflationary
- stabflationary
Etymology of STAGFLATIONARY
The word "stagflationary" is derived from the combination of two terms: "stagflation" and "-ary".
1. Stagflation: This term was coined during the 1970s to describe a unique economic phenomenon characterized by a combination of stagnant economic growth, high unemployment rates, and high inflation. The term itself is a blend of "stagnation" and "inflation", highlighting the two key components of the condition. It was first used by British politician Iain Macleod in a speech in 1965.
2. -ary: The suffix "-ary" is frequently used in English to form adjectives. It typically denotes characteristics, qualities, or conditions related to the base word. For example, "inflationary" refers to something related to or causing inflation.
When these two elements are combined, the term "stagflationary" emerges to describe something that is related to or characteristic of stagflation.
Similar spelling word for STAGFLATIONARY
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