Cost-Push Inflation
Cost-push inflation begins when supply falls or unit costs rise and price pressure spreads; learn pass-through, evidence, examples, and policy limitations.
Compare inflation, demand-pull and cost-push mechanisms, and hyperinflation while avoiding informal labels with conflicting thresholds.
Inflation Causes and Severity distinguishes the measured inflation rate from possible demand, supply, cost, expectations, and policy mechanisms. It also separates analytically useful concepts from informal labels whose thresholds vary across sources.
| Page | Use it for |
|---|---|
| Inflation | Definition, measurement, causes, real-return effects, severity language, and the difference from disinflation or deflation |
| Demand-Pull Inflation | Price pressure when aggregate spending persistently exceeds sustainable productive capacity |
| Cost-Push Inflation | Supply losses, rising unit costs, pass-through, margin pressure, and second-round effects |
| Hyperinflation | Extreme inflation that disrupts money, accounting, contracts, saving, credit, and ordinary pricing |
| Observation | What it may suggest | Why it is insufficient alone |
|---|---|---|
| Strong spending and employment | Demand pressure | Output and labor supply may also be expanding |
| Commodity or import-price increase | Cost or supply shock | Firms may absorb it, substitute, hedge, or pass it through only partly |
| Rising wages | Labor-cost pressure | Productivity, margins, catch-up, and composition affect unit costs |
| Broad persistent inflation | Propagation beyond one category | Demand, supply, expectations, and policy can interact |
| Currency depreciation | Imported-price pressure | Invoicing, hedges, margins, and domestic demand determine pass-through |
Use multiple data series and a clear timing narrative. A cause label should explain how a shock reached a broad price index, not merely restate that prices rose.
Terms such as creeping, walking, and galloping inflation are informal and have no universal numerical boundaries. Double-digit inflation has a clear arithmetic meaning only after the period is stated: for example, a 12-month rate of at least 10%. None of these labels identifies the cause or guarantees the next stage of an inflation episode.
For analysis, report:
Continue to Inflation Gaps, Rates, and Spirals for rate calculations, output-gap frameworks, and feedback dynamics, or Wage and Imported Inflation for narrower transmission channels.
These pages provide general economic education, not an inflation forecast, policy recommendation, or personalized financial advice.
Choose a subsection first. Deeper term pages live inside each subsection, which keeps large topic hubs readable.
Cost-push inflation begins when supply falls or unit costs rise and price pressure spreads; learn pass-through, evidence, examples, and policy limitations.
Demand-pull inflation occurs when aggregate spending persistently outpaces sustainable productive capacity; learn the mechanism, evidence, and policy limits.
Hyperinflation is an extreme, usually accelerating rise in the general price level that severely disrupts money, contracts, and financial reporting.
Inflation is a sustained increase in a broad price level; learn how it is measured, what can cause it, and how it affects purchasing power, rates, and finance.