What Are The Types Of Inflation?


12 Answers

Rebecca Hunt Profile
Rebecca Hunt answered
The different types of inflation that exist vary depending on the definition that is used but many agree that the four types can be categorized as; wage inflation, cost-push inflation, pricing power inflation and sectoral inflation.

While these categories deal with different areas of inflation, they all contribute to the general outcome of the economic event. That is, the rise of the general levels of prices of services and goods that occurs in an economy over a given period of time.

  • Wage Inflation
Wage inflation can also be referred to as demand pull or excess demand inflation. It is the rise that occurs when the total demand for goods and services in an economy exceeds the supply of the same. These circumstances when the supply is less causes the prices of the goods and services to rise. This leads to the situation that can be called a demand pull inflation.

  • Cost push inflation
Cost push inflation is the term given to the situation where a forceful increase in the prices of goods and services is caused by the increase in the cost of the production of these goods and services.

For example, if there is a rise in the wages of laborers for a specific product, the cost of the production of this product would rise and therefore the price related to the finished product would also rise.

  • Pricing power inflation
Pricing power inflation is also referred to as administered price inflation. This type of inflation occurs when business houses and industries decide to increase profit margins by increasing the prices of their goods and services. This is a type of inflation that does not occur during financial crises.

  • Sectoral inflation
This takes place when there is an increase in the prices of goods and services that are produced by a specific industry sector. For example, an increase in the price of crude oil will affect all other sectors that are directly related to the oil industry.

These are four of the categories that inflation can be divided into. Many argue that cost push and demand pull are the two main ones, while others believe all four are equally important.
amber Jhon Profile
amber Jhon answered
Inflation is the increase in the level of prices. There are four types of inflation including;demand pull inflation, cost push inflation, pricing power inflation and sectoral type inflation. The first type of inflation is demand pull inflation or excess demand inflation. When the demand of the products and services are increased than the supple of them in an economy, then this inflation is caused. Second type of inflation is the cost push inflation. This inflation is caused when the costs of raw materials are increased which eventually increase the prices of final goods. Third type of inflation is pricing power inflation which is also known as administered pricing inflation. When the companies increase their prices to increase their profit margin, then it is pricing power inflation. Fourth type of inflation is sectoral type inflation, which is caused when other three types of inflation hits a specific industry. For example, if oil prices increases then it will have an impact on other industries as well.
Sibyl Zoe Profile
Sibyl Zoe answered
There are 3 main types of Inflation as described by the economist Robert Gordon which are:
- Demand Pull Inflation: Caused by increase in aggregate demand. This increase is caused by increased private and government spending.
- Cost Push Inflation: Is caused by a drop in aggregate supply which is caused by increased prices of inputs. It is also called as Supply Shock Inflation.
- Built -in Inflation: Is caused by higher wages of workers. It is induced by Adaptive expectations.
rizwan anjum Profile
rizwan anjum answered
Walk inflation
Running inflation
hyper inflation
demand pull inflation
cost pull inflation
creeping inflation
open inflation
suppessed inflation
profit included inflation
full inflation
partial lnflation
Anonymous Profile
Anonymous answered
There many many types of Inflation:
1. Demand Pull Inflation
2. Cost Push Inflation
3. Stagflation
4. Suppressed inflation
5. Reflation etc.....
humiee n.s Profile
humiee n.s answered
1)cost-push inflation2)demand-pull inflation3)monetarist inflation4)imported inflation
Anonymous Profile
Anonymous answered
I think there are only two type of inflation first is demand pull and second is cost push inflation, because they cover every other types of inflation. HAIDER

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