New Approach to Inflation Phenomena to Ensure Sustainable Economic Growth

The problem of inflation is crucial for ensuring sustainable economic growth of the country. In the broadest sense, the economic dimension of sustainable development represents the general economic health of the country. Such macroeconomic indicators as unemployment and inflation rates are the main...

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Bibliographic Details
Published in:Sustainability 2022-01, Vol.14 (1), p.518
Main Authors: Girdzijauskas, Stasys, Streimikiene, Dalia, Griesiene, Ingrida, Mikalauskiene, Asta, Kyriakopoulos, Grigorios L
Format: Article
Language:English
Subjects:
Central banks
Consumer Price Index
Economic development
Economic growth
Indicators
Inflation
Inflation (Finance)
Interest rates
Lithuania
Methods
Sustainability
Sustainable development
Theoretical analysis
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Summary:The problem of inflation is crucial for ensuring sustainable economic growth of the country. In the broadest sense, the economic dimension of sustainable development represents the general economic health of the country. Such macroeconomic indicators as unemployment and inflation rates are the main economic indicators of sustainable development. This article discusses the historical aspects of inflation development and the attitudes of economists towards it. The article presents a new approach to inflation and analyses the main reasons for its formation by developing a new analytical model of aggregate inflation. Based on new analytical model, the theoretical analysis of the formation of an economic bubble is provided based on saturation phenomena and its micro and macroeconomic implications are discussed. The main input of this paper is the creation of an extended (detailed) inflation model representing the main drivers of inflation and therefore contributes to the concept of controlled economic growth, which is necessary to ensure sustainable economic growth of the country.
ISSN:2071-1050
2071-1050
DOI:10.3390/su14010518