Paul KrugmanJan 1, 2023
Continuing this discussion. Again, Olivier is tapping into an important point often missed in monetary/macroeconomics: in the end, it all comes down to individual motives and decisions 1/ https://twitter.com/ojblanchard1/status/1609000406184591360
Olivier Blanchard on Twitter

“1. Answering John Cochrane: no contradiction: Higher aggregate demand leads everybody to want to increase their price relative to others. This is a distributional conflict in which everybody wants more, leading to increasing and increasing prices, i.e. inflation.”

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Show threadPaul KrugmanJan 1, 2023
A business that raises its prices doesn't do so because the Fed has increased the money supply. The chain of events that leads to that price rise may have started with the Fed, but the firm is responding to its own market conditions 2/
Show threadBill
@pkrugman is it? Or in some cases is it just price gouging because they think they can?
Jan 1, 2023 at 6:27pmMastodon for Android