Talk:Inflation

"Austrian School"

Is it really necessary to even have a blurb on this, especially since it's so misleading?

It starts out with "The Austrian School asserts that inflation is an increase in the money supply, rising prices are merely consequences and this semantic difference is important in defining inflation." This assertion is highly absurd and contradicts the bulk of the article. Looking at the equation MV = PY (money supply * money velocity = price level * GDP), inflation is when P increases, not when M increases.

I understand that the article uses the qualifier "The Austrian School asserts," but there are two important points here: 1) this view is starkly in contrast with what people actually define inflation as, such that its mention may confuse the reader, and 2) should we give any significant amount of attention to a viewpoint that not only has no acceptance in the professional world, but has virtually no influence outside of fringe political cliques on the Internet? I see that the articles on evolution and natural selection do not give nearly as much credence to professionally unaccepted views as this article does. --Dwarnr (talk) 03:21, 23 May 2010 (UTC)

Are comments like these even necessary? The Austrian School is the oldest continual school of economic thought and the only school who holds true to the original definition of inflation. As for not being accepted in the professional world, that is to the Austrians' credit. All the so called "professionals" were either completely blindsided by the last bubble (like they've been in the past as well) or called for the housing bubble to inflated. Austrian economists were by and large the only ones who 1) saw it coming 2) told people why it was coming and 3) are still the only ones who can give a logic, coherent and comprehensible explanation to why it came. People like Peter Schiff and Ron Paul have popularized the Austrian School in recent years, along with best selling authors like Thomas Woods.

And what is absurd with claiming that increases in money supply leads to higher prices? If there is one thing that has been proven by history, that it is, not to mention that rising prices is a natural, logical and unavoidable consequence of inflation. If you'd just leave your ridiculous formulas to the scrapheap of history where they belong you'd see that. Further, it is important to separate inflation from rising prices. Inflation has a lot more dire effects than just rise in prices, in addition to the fact that prices rise very differently depending on what commodity, asset or service you look at. The Austrian School is the only school who understands that you can't look at aggregates, you have to look at individual sectors. It was focusing on aggregates that made the great Keynesian Paul Samuelson claim as late as 1989 that the USSR would overtake the US. The second and most obvious point is that prices can rise for various reasons, inflation being merely one of them.

The only confusion this article creates are found in the mindboggling logical fallacies found in the bulk of the text, mainly in the Keynesian excerpt. I can't believe that even after the biggest bubble in history of the world, people still cling witch doctors like Krugman, Mankiw, Stiglitz, Bernanke and Galbraith. No matter they've been proven wrong in everything they've ever said. No matter the Austrians have been proven right in everything they've ever said. No matter that these two claims are aptly documented and easily demonstrable.

The so called "Austrian view" is the only view that should be displayed here on Wikipedia. It is the theory of evolution to your creationism and intelligent design. Misessus (talk) 19:10, 14 August 2010 (UTC)

I'll try to set aside Poe's Law and answer this seriously. What specific text in the article is wrong, and what would you replace it with? It would be helpful if you could support each replacement with cites from reliable sources (or, at least, sources more reliable than witch doctors like Krugman, Mankiw, Stiglitz, Bernanke and Galbraith :-)

bobrayner (talk) 19:42, 14 August 2010 (UTC)

Unfortunately, Misessus is totally serious about this, and is merely reflecting the party line over at the Von Mises Institute. But since we write articles based on verifiability not truth, the world will have to remain ignorant to the fact that they are mistaken about the 'true meaning' of certain words. LK (talk) 01:06, 15 August 2010 (UTC)

The main problem with the article is the sheer length of it. It gives the impression that inflation is some sort of mystical economic phenomenon that nobody really can explain. This is underscored by the many different "views" of inflation. In reality, inflation is nothing but the increase in supply of money. That is all that needs to be said about it. The word "inflation" was first used in the US in the 19th century, to describe advocates of printing money. They were called "inflationists". The phenomenon itself is, as history shows, very old indeed. Nicolas Oresme wrote about it as early as the 14th century, and Juan de Mariana wrote a treatise on it in the beginning of the 17th century. The mystification of inflation, which was no mystery at all for at least 700 years has served no other purpose than to disguise this third way of funding government spending. It was part of the scientific revolution in the field of economics, prompted by neoclassicists and keynesians to make economics more like the natural sciences. It was then the various formulas started to appear, along with mathematical modeling, as well as other misguided concepts such as perfect competition and so on.

This article would be much more informative if it did nothing else than to state the obvious and documented truth, i.e. that inflation is the increase in the supply of money. The CONSEQUENCES, on the other hand, deserve a section of its own, describing what different schools claim to be the consequences of inflation. That would make sense, because various schools propose different things.

On a final note, I think it is symptomatic for the economics pages on Wikipedia that they are not concerned with truth, only to reflect the popular opinion. I should like to remind Lawerencekhoo and everyone else that science is not a matter of opinion, it is a matter of fact. That goes for economics as well. This article would serve the public much better if we removed everything save the simple and documented, original definition of inflation, and then listed what the various schools claim to be consequences of inflation. That would remove all contradictions as far as the meaning of the word goes, and display the differences of opinion of what inflation causes. Then the reader can make up his own mind about what he thinks sounds reasonable. What could be better than that?

I'm quite frankly appalled by the constant hostility of several Wiki editors against the documented truth about economics. It does tremendous damage to the credibility of Wikipedia.

Misessus (talk) 07:57, 15 August 2010 (UTC)

At a minimum, it was given weight that seems to exceed its academic prominence. I've endeavored to correct that issue. BigK HeX (talk) 08:35, 15 August 2010 (UTC)

And how exactly are you qualified or competent to make that judgement? The section stays. Ron Paul is by leaps and bounds the most prominent member of Congress when it comes to economics and monetary theory, and is a well known advocate of the Austrian School. In addition, Austrian economists and historians produce best selling books year after year, and work as professors in numerous prestigious universities in both Europe and the US. Stop the witch hunt. There is no basis for it, and I won't allow it.

Misessus (talk) 11:28, 15 August 2010 (UTC)

Here's an idea. Stop ranting with that talk of Ron Paul, and actually prove me wrong. You are the editor supporting inclusion so it will be YOU who proves that allotting so much text meets WP:NPOV (specifically, WP:DUE). BigK HeX (talk) 17:58, 15 August 2010 (UTC)

It's been a while since I've edited this article (probably a year), and I agreed that the Austrian School was given too much weight in the article (and Wikipedia overall) and helped to reduce the content to a reasonable level. I usually stay out of this article as things are usually under control by LK and a few others, but it appears now that it has shifted too much in the other direction. A single sentence for the Austrian section, even in summary style, is absurd. BigK Hex's edits on Aug15 are a violation of NPOV and against long standing article consensus. I'm restoring that section to the version before BigK Hex and Misessus touched it (August 10th). Stop edit waring or you'll be blocked. Please discuss further edits on the talk before changing. Morphh ^(talk) 18:48, 15 August 2010 (UTC)

Personally, I think a single sentence is being generous. I'd like to see evidence that it deserves any mention. If you have some, then please post. BigK HeX (talk) 18:51, 15 August 2010 (UTC)

I'm sorry, but you're removing long standing content of sourced material. In such cases, it is you that must "prove it" otherwise. Keep in mind that, in determining proper weight, we consider a viewpoint's prevalence in reliable sources, not its prevalence among Wikipedia editors or the general public. We've already had this discussion in depth at WikiProject Economics for some years now. They do have sufficient coverage in reliable sources to present their POV. In many cases on Wikipedia (though this has been reduced), their view has had too much weight, but a few paragraphs seems appropriate for this article since it's something they write about often. We must present a point of view with a level of content that adequately presents the point of view. The material is source, adequately presents the point of view with a reasonable amount of content (few paragraphs). I have no issue with attempting to correct content if it was incorrect, as Misessus was suggesting, but I do have a huge issue with deleting mass content that has had long standing. Morphh ^(talk) 19:05, 15 August 2010 (UTC)

I'll note that -- technically -- the burden of proof for adding text into an article lies with the editor wishing to include the text. I've seen a fair number of bytes devoted to discussing this issue, but I still don't see any editors providing us with evidence that the view deserves as much prominence as monetarism or the most of the other views discussed in the Wiki article which seem to be given as much weight as the Austrian stuff.

I certainly don't care about the prominence among Wikipedians, but I do want to see a bit of evidence regarding reliable sources on Austrian Inflation, given that: "in determining proper weight, we consider a viewpoint's prevalence in reliable sources". I don't think this particlular matter is all that significant, but I am still curious to see supporting editors show that this included material is WP:DUE. BigK HeX (talk) 19:20, 15 August 2010 (UTC)

You're reading WP:V. We're not adding new unsourced text here for which that rule applies. I'm restoring a long standing consensus of sourced text, which is not the same thing. LK and I (among others, removed a great deal of Austrian text already). As for proof, there are plenty of reliable sources that show this view represents a minority view and their is certainly enough to merit three paragraphs of that viewpoint here. This section is a summary style and should have enough content to minimally summarize that section and adequately present the POV, which I think the prior content did. Maybe we could trim it to two paragraphs, but one sentence is not acceptable. The Keynesian view has 11 paragraphs and the Monetarist view has four with additional math and information and another article (maybe it should have more). So two-three paragraphs of a summary style for this viewpoint is not unreasonable. Morphh ^(talk) 19:55, 15 August 2010 (UTC)

Alrighty. Fair enough. Trimming it down a tad more, and expanding the Friedman's stuff might give it the balance I would have expected to be more representative of the prominence. BigK HeX (talk) 20:03, 15 August 2010 (UTC)

I trimmed it down and cleaned it up a bit. Morphh ^(talk) 20:49, 15 August 2010 (UTC)

I think Morph has done good work here, and I'ld like to thank him for his good sense and attention to detail. LK (talk) 07:16, 16 August 2010 (UTC)

BigK HeX, if you'd actually read what has been said, you'd know that I had offered several arguments already. You can't just ignore what people say and then claim they never said anything.

The Austrian view is represented in many prestigious universites in the world, both in the US and Europe. People like Thomas DiLorenzo, Walter Block, Bill Barnett, Guido Hülsmann, Walter Williams, Thomas Sowell and several work at universities, some even heading the economics department.

The Austrian view has also been represented in the mainstream media for years, mainly thanks to Peter Schiff and Jim Rogers, who have been constant features on various financial shows.

Austrian historians and economists have continuously produced best selling books, and continue to do so to this day.

The Mises Institute website is the world's largets web portal for economics and political philosophy, with well over a million views per month.

In politics, the Austrian view is being advocated by the most prominent and prolific politician of our day when it comes to economic and monetary policy, Ron Paul, also a best selling author. Thomas Woods has testified before the House of Representatives.

To call the Austrian School a fringe movement and that it shouldn't even be mentioned on Wikipedia borders on hysterical and flies in the face of the very rules you and others so frequently refer to. As it stands now, the Real Bills Doctrine section is the same size as the Austrian section. If you were actually concerned about the balance of the article, you would have called for the abolition of the whole RBD-section. But no, you've only called for the abolition fo the AS-section, which prooves that your arguments has nothing to do with balance or Wiki-rules, it is completely personal. —Preceding unsigned comment added by Misessus (talk • contribs) 06:02, 17 August 2010 (UTC)

I don't see any consenus against the addition I did. I will revert your deletion and submit it to discussion. The reason for the addition, which in itself was very minor, was to explain one of the key reasons why Austrians make this distinction. This is material information and fits well in the summary.

Misessus (talk) 12:50, 17 August 2010 (UTC)

Restoring collaborative version of text

We have at least three editors here agreeing to a reduced version of text on the "Austrian view". Then, mere hours later, Misessus (in seeming disregard of the consensus newly reached) expands the text yet again. I, personally, do not find the topic to be worthy of the weight accorded, with Misessus failing to provide evidence of attention that the theory has received from the wider academic community, making it a small minority viewpoint at best (or -- more likely -- a tiny minority viewpoint, which would explain its absence in the Inflation articles of other encyclopedias). Is there support for the expanded text or should it be reduced, per the previous decision of editors? BigK HeX (talk) 15:58, 17 August 2010 (UTC)

The addition I made was three sentences. It did not expand the section in any significant way, but was very relevant considering the nature of the article.

BigK HeX, I've provided you with ample evidence for why the Austrian view merits a separate section. Your constant denial of this just childish, and indicates that you like so many other people seem to have an inexplicable, personal animosity towards the Austrian School. It is clearly far more prominent than the Real Bills Doctrine, yet you have seem to have no problem with the attention this obscure peculiarity has been given. In fact, nobody seems to have a problem with that, the only problem is with the Austrian School. But here is the evidence, for the fourth time now I believe:

1. The Austrian view is represented in many prestigious universites in the world, both in the US and Europe. People like Thomas DiLorenzo, Walter Block, Bill Barnett, Guido Hülsmann, Walter Williams, Thomas Sowell and several work at universities, some even heading the economics department.

2. The Austrian view has also been represented in the mainstream media for years, mainly thanks to Peter Schiff and Jim Rogers, who have been constant features on various financial shows.

3. Austrian historians and economists have continuously produced best selling books, and continue to do so to this day.

4.The Mises Institute website is the world's largets web portal for economics and political philosophy, with well over a million views per month.

5. In politics, the Austrian view is being advocated by the most prominent and prolific politician of our day when it comes to economic and monetary policy, Ron Paul, also a best selling author. Thomas Woods has testified before the House of Representatives.

You can keep lying about me not having provided evidence if you want, it only proves I am right about you and your buddies. If you want to discuss the merits of the Austrian School, you have to discuss the merits of the Real Bill Doctrine section first.

Misessus (talk) 18:50, 17 August 2010 (UTC)

You fail still to "provide evidence of attention that the theory has received from the wider academic community". Your repetition of the claim that amounts to little more than "Austrians discuss the Austrian theory" is useless in describing the wider academic community ... obviously. BigK HeX (talk) 19:11, 17 August 2010 (UTC)

An what such evidence have you provided in support of the Real Bills Doctrine? What does the wider academic community even mean? Austrians frequently debate mainstream economists. Thomas DiLorenzo and Thomas Woods have been in the mainstream hot seat for years. Murray Rothbard's book on the panic of 1819 is widely acknowledged as the best book on the subject. Many mainstream economist are finally coming to the realization that Hoover's and FDR's New Deal policies actually made the Great Depression worse, something Austrians have always claimed to be the case. The current economic crisis has visibly raised the public interest in the Austrian Business Cycle Theory, evidenced by the fact that Ron Paul's Audit the Fed bill got over 300 co-sponsors.

Your constant denial of well documented facts is just childish. And again, and try to actually understand this now, before there is any discussion about the Austrian section, you first have to produce evidence for the Real Bills Doctrine having received "attention from the wider academic community". Why don't you have any problems with that section being there? I would also like to remind you that you don't possess the right to judge what is evidence for some undefined criterium and what isn't. You have repeated the claim of lacking evidence with the persistency and intelligence of a parrot. Now you show me the reason why Real Bills Doctrine deserves a section of its own, but not the Austrian School. I'm tired of your inane bullying and won't have any more of it. Misessus (talk) 23:49, 17 August 2010 (UTC)

Re: "What does the wider academic community even mean?

It means exactly the same thing that is meant by WP:RS, which doesn't seem too difficult for most editors, but maybe you're an exception. Since you keep making reference to Austrian publications, you should note that WP:RS states: "Care should be taken with journals that exist mainly to promote a particular point of view. A claim of peer review is not an indication that the journal is respected, or that any meaningful peer review occurs. Journals that are not peer reviewed by the wider academic community should not be considered reliable, except to show the views of the groups represented by those journals."

You've typed a lot of words about what AUSTRIANS are saying ("Tom Woods has a bestseller", "DiLorenzo is a professor!") .... which is strange since I've asked you about how the majority views Austrian Inflation. I find it fairly baffling that you repeatedly fail to understand that your useless "factoids" about Tom Woods, Ron Paul, et al. are exactly ZERO evidence that there is any significant regard for this viewpoint outside of the tiny Austrian clique.

Additionally, that you keep babbling about your little Real Bills Doctrine red herring is similarly off-topic. My current concern is the Austrian School WP:UNDUE weight. If you choose to tackle the Real Bills material at this time, then go for it, but that obviously has precious little relevance to justifying any violations of WP:NPOV caused by excessive Austrian school text. BigK HeX (talk) 07:59, 18 August 2010 (UTC)

You persist in your childish ways. Well, that was to be expected. My point was that your concept of wider academic acceptance was very selective. To this day, you've not been able to produce one single argument for your point, you always come back to your childish ad hominem and hysterical claims. No one has claimed that the Austrian view is presently the majority view, but it is quite obviously a significant minority view, which is why it has its own, albeit very tiny section. I have proven that it is a significant minority view with the facts I've listed, something you fail to understand. Maybe you should read and think a little more instead of trying to find as many Wiki-guidelines to refer to as possible. We are all aware of them, your constant referral to them is meaningless and a poor disguise for your lack of real arguments.

The fact you that you don't understand the relevance of the Real Bills Doctrine just goes to show how unqualified you are as an editor, no matter how many times you refer to official Wiki-guide lines. The Austrian School is clearly much more significant than many other schools represented in this article. If your concern were with balance and undue weight, you would have to address all those other schools and demand their deletion as well, but you don't. You only want to censor the Austrian school.

The question is whether any specific views should be presented at all, or if the whole article should only echo the Keynesian view, in which case even the monetarist section should be deleted and there would not be a specific mention that this article represents the keynesian view. But you don't understand any of this, you're so hell bent on deleting a specific school you for whatever reason don't like. You're so blinded by your bias that you don't even understand what the discussion is really about or what the implications of your own demands are. Either you cut EVERYTHING except the keynesian text, or you leave the article as it stands today. Or you can just admit you don't care about how the article looks, just as long every mention of the Austrian School is deleted. Misessus (talk) 04:23, 19 August 2010 (UTC)

You stuff an awful lot of red herrings and Two Wrongs fallacies into your long-winded screeds. This discussion is about the weight of the Austrian School text -- not whether "everything except 'Keynesianism' should be stripped from the article", not the Real Bills Doctrine yet, and not for your silly little characterizations of my "childish" behavior. If I wanted to "censor" the Austrian School, I would have deleted the entire section. Rather obviously, my disinclination to delete the Austrian school text outright shows consorship isn't my goal, but you seem unable to see past your POV and vitriol to see even the obvious. You can continue to praise Austrians for receiving some attention, in general, but this discussion is about specifics. And since you've failed to provide even a single source that provides indication that -- specifically -- the Austrian theory of inflation is a significant viewpoint among reliable sources on inflation, I will give the text a weight proportional to the reliable sources you've provided. If you decide to provide reliable sources (reviewed by the wider academic community), then I may have more to say. I'm guessing you'll throw out more ad hominems, unsourced generalities, and praise for Ron Paul instead of any substantive evidence about this specific topic. So, cheers! BigK HeX (talk) 07:39, 19 August 2010 (UTC)

Misessus, could the additional content your adding be placed in the Monetary Inflation or the section The Austrian view of inflation? If not, could you explain why this addition is important in our overview. For me, the addition seems more like additional information (expanded detail) for the viewpoint rather than a necessary part of a summary overview. The intent of the section is to give the reader a quick understanding of the view and direct them to the other articles for the details on that viewpoint. Morphh ^(talk) 14:10, 19 August 2010 (UTC)

Morph, the reason for making the addition was to describe the reason why Austrians adhere to the original meaning of the word. It illustrates the fundamental difference between Austrians and mainstream, i.e. that Austrians focus on individual sectors of the economy while mainstream economists focus on aggregates, like the general price level. This is perhaps the most significant difference between the two, and no other issue makes this difference so clear than inflation. I would dare claim that if nothing else is written about the Austrian school on this article, this is what the Austrian section should say.

Misessus, the 'Related definitions' and 'Measurement' sections of the article make perfectly clear that your argument here is mistaken. Mainstream economists, who use 'inflation' to mean 'a rise in the price level', often analyze a rise in prices overall, but they also frequently analyze price rises in narrower indices. So central bank analysts and other mainstream economists talk about 'CPI inflation', but they also talk about 'core inflation', 'commodity price inflation', 'housing price inflation', 'wage inflation', etc. Mainstream economists perfectly agree with Austrian economists that prices in some sectors of the economy react more quickly to changes in the money supply than those in other sectors. Therefore there is no justification for treating this as a uniquely Austrian point. In fact, the 'measurement' section already makes this point, since it specifically discusses to 'core inflation' as being a measure of price rises in those sectors where prices change more slowly. Rinconsoleao (talk) 11:21, 20 August 2010 (UTC)

When comparing the different views on inflation, the first and only really relevant question is why does it matter how various schools define this specific term. To many it may seem a pointless debate. My addition answers that question. That is why it should be there. And again, the addition was THREE SENTENCES, its not like the Austrian section suddenly became dominant. But if the consensus is that these three sentences was the straw that broke the camel's back, then I could read through the section again and suggest deletion of some other part of it. I'd rather it stayed the way it is of course, but if it is deemed necessary, I will find something to delete.

BigK, it was clear from the start that you had no intention of engaging in a meaningful discussion about this, you proved that by calling for the deletion of the entire section. I will leave you to your ranting and continue the discussion with those capable of rational debate. I nevertheless want to thank you for your passionate input and apologize for losing my temper here and there.

Misessus (talk) 20:20, 19 August 2010 (UTC)

Rincon, you are wrong. The mainstream definition refers to a rise in the -general- price level, which is why the CPI is the most common measure of inflation. The whole Keynesian theory is based on aggregates, this is why they always talk about stimulating aggregate demand and spending. This is also why Keynesians falsely believe that the US experienced massive economic growth during WWII, because that is what they conclude from looking at statistics, which show huge increases in aggregate spending. Consequently, Paul Samuelson as late as 1989 was convinced that the USSR would overtake the US, precisely because all he did was look at aggregate numbers, not the individual factors behind those numbers.

The same thing can be observed today. Ben Bernanke has on several occasions testified before Congress that there is no inflation in the US, because the overall price level has remained fairly stable, not mentioning the skyrocketing prices in health care and education. This has been echoed by several other prominent mainstreamers, such as Galbraith. Even if mainstream economists sometimes look at specific prices, it is undeniable that their focus is always on aggregates, whereas the Austrians' focus always is on individual sectors of the economy. This is why mainstream economists also always advocate actions to increase aggregate demand and aggregate spending, calling for monetary stimuli of various forms, be it then cash-for-clunkers, tax rebates for home buyers, spending on infrastructure and whatnot. Keynes said it best in his "General Theory", which was then echoed by Krugman, with his money in the mine example. He said that during a depression with low aggregate demand, the government should put cash in glass jars and bury them in abandoned mines and then implode the mines. Then, they should sell excavation rights to the public, letting them buy the right to dig up these jars of money, which they then can spend. This to increase aggregate demand and spending.

Nothing in the "Related definitions" section does anything to contradict my argument. I could write an entire article on this very subject. In addition, I would ask that you in the future insert your edits -below- the text you are responding to. When the talking page gets this long, there is a big risk of edits getting lost in all the other text if you don't put it last, which in turn is actually a rather funny analogy of the whole individuality vs. aggregate debate. At any rate, I am going on a two week trip to Scotland and I'm not sure if I'll have any internet access during that trip. Since no serious objections have been raised against the addition, I would ask that it is left standing and that the article is opened for edit again. Misessus (talk) 07:40, 22 August 2010 (UTC)

Opening paragraph is just plain wrong

Inflation is not a rise in prices. It's an increase in money supply over-and-above the demand for goods and services. Here's a pretty good definition: http://www.yourdictionary.com/dictionary-articles/definition-of-inflation.html --LanceHaverkamp 22:14, 15 August 2010 (UTC) —Preceding unsigned comment added by Lance W. Haverkamp (talk • contribs)

That is monetary inflation which is a separate, but real, phenomenon. It has its own article. This article is about price inflation, which is what almost every economist means when they say "inflation" except when they explicitly qualify it by saying "monetary inflation" or "inflation of the money supply".

The link you supply makes it clear that it is a personal view of Your Dictionary when they say "Here at YourDictionary, we define inflation...". Now, I have never heard of modern dictionaries having opinions before but clearly they couldn't resist a little bit of editorialising on this. Sadly they are not in agreement with mainstream economic usage. Our own, Wiktionary does a much better job of explaining all the different usages without favouring one over another:

Look up inflation in Wiktionary, the free dictionary.

--DanielRigal (talk) 22:54, 15 August 2010 (UTC)

If this article is about "price inflation", it should be called "Price Inflation", to do otherwise is both misleading and inaccurate. And that change wouldn't make the opening paragraph accurate. Price inflation is not a phenomenon (to borrow your very good term) unto itself, it's entirely a side-effect of what you are calling monetary inflation--it does not exist apart from monetary inflation. Given a hard currency, prices naturally fall (rather than rise) over time, as a result of manufacturing innovations and competition. If we have any desire to write about price inflation at all, it should be a sub heading under monetary inflation. --LanceHaverkamp 23:36, 15 August 2010 (UTC) —Preceding unsigned comment added by Lance W. Haverkamp (talk • contribs)

You have a right to hold your own opinions on these issues but when they diverge from mainstream thinking and language usage you can't simply expect articles to be modified to fit your personal views and nomenclature. We are well aware that there is a small group who zealously believe that there is only one "real" type of inflation and who want to simply ignore mainstream usage as "wrong". We have them turning up here quite regularly to argue the toss. We do have articles about their non-mainstream views and we are not trying to keep their views out of Wikipedia but we also have to maintain a sense of perspective. We have to cover mainstream views as our main concern in this article. As it stands the introduction is a correct introduction to what most economists mean when they say "inflation". --DanielRigal (talk) 23:48, 15 August 2010 (UTC)

Here's a thought experiment. If Wikipedia had existed in the time of Copernicus and then Galileo, would the entry for the earth had said it was flat and that the sun revolved around it? Would it have treated "zealous" supporters of Galileo and Copernicus as fringe crack pots and blocked them at every turn? Misessus (talk) 06:12, 17 August 2010 (UTC)

Here's a thought experiment. If Wikipedia had existed in the time of Armstrong and Kaysing, would the entry for the moon landings have said it was certainly possible that it was faked? Would it have treated "zealous" supporters of the Moon Landing Hoax theories and Kaysing as fringe crack pots and blocked them at every turn? BigK HeX (talk) 06:48, 17 August 2010 (UTC)

It is an interesting question that Misessus asks. Of course, it is possible to object that nothing like Wikipedia could exist at that time as the church acted as sole arbiters of truth and the communications infrastructure was such that most people did not have access to information about current controversies. Information was handed down from on high. It is even easier to object that the Ptolemaic Geocentric model has the Earth as a sphere not as a flat disk, which was a popular superstition believed only by the uneducated.

To take the question at face value though, a Wikipedia of the time would certainly cover the matter as follows:

• Detailed coverage of the Ptolemaic model acknowledging its official status and general acceptance in both the Christian and Islamic world but also pointing out that it has problems and that alternative theories exist.
• Separate coverage of the Heliocentric theory explaining its claims as well as its status as an emerging theory, its own accuracy problems (remember that until the elliptical nature of plantary orbits was discovered the heliocentric model was no more accurate than Ptolemy's) and its condemnation as heresy.
• Detailed coverage of the Earth's spherical shape and the various estimates of its size.
• Separate coverage of flat earth beliefs setting out their history and status as fringe.

Now, I leave it as an exercise to the reader to build their own analogy around this. Are the Austrians the brave pioneers of a new theory of inflation in the style of Copernicus, or are they the ones stuck in the mud of previous centuries discredited beliefs like the flat earth believers?

Analogies can be interesting but they can also be quite arbitrary. You can normally craft one that flatters your own position. Amusing though this has been, it doesn't actually help to point the way forward on issues of inflation. It does help to clarify the correct approach that Wikipedia should take in a controversy though, so it hasn't been a complete waste of time. --DanielRigal (talk) 08:27, 17 August 2010 (UTC)

Heh... you're too kind in actually expending so much typing on such a self-serving hypothetical. For a serious response, I would have said that it's barely worth just pointing him to WP:NOTCRYSTAL and WP:UNDUE and being done with it. BigK HeX (talk) 08:47, 17 August 2010 (UTC)

Nice analogy, but kind of misleading. Nobody involved in this page is questioning whether 'monetary inflation' and 'price inflation' exist. The only debate is what they should be called. This page equates 'price inflation' with 'inflation', because that is the most common terminology today.

So a better analogy is: if Britain had a much larger population than America, would the spelling 'colour' be more common than the spelling 'color' in Wikipedia articles? Yes, it probably would. Would that matter? No. Rinconsoleao (talk) 11:12, 17 August 2010 (UTC)

Agree with Rinconsoleao - see WP:COMMONNAME. Morphh ^(talk) 11:19, 17 August 2010 (UTC)

Seems we should probably have a link to Monetary inflation either in the "About" tag or add the wikilink in the third paragraph where we describe the effect. Morphh ^(talk) 11:33, 17 August 2010 (UTC)

This article is about a general rise in the level of prices. For a increase in the money supply, see Inflation (monetary). For the expansion of the early universe, see Inflation (cosmology). For other uses, see Inflation (disambiguation).

Morph raises a good point. The difference between the shape of the earth and inflation is that the former is a question of theory, the latter a question of defining the meaning of given word. It is a well documented fact that inflation originally meant increase in the supply of monetary units. Not even the most hysterical anti-Austrians (like BigK Hex) can dispute that fact. Inflation was a specific action taken by specific parties, usually the state, but also by banks. Going further back in history, it was the exclusive perogative of the king. Then inflation referred to the specific actions of coin clipping and diluting.

The word inflation replaced the earlier terms coin clipping and diluting mainly because of the simple fact that governments and banks didn't clip coins or dilute them, they printed paper money instead. The action itself, its dynamics and its purpose remained unchanged. It was only in the 20th centurie some economists started to equate inflation with rising consumer prices. It is an observable fact that the money supply started to increase after the Fed was founded, and that the price level has risen almost continously since then. For whatever reason, more and more economists started to follow the rise in prices instead of the increase in the supply of money. Due this shift, the meaning of the word inflation shifted too.

This is interesting, because due to the very well documented history of the origin of the word inlfation, we can clearly state the mainstream is in fact using the word wrongly. And again, there is no theory of the origin of the word inflation, it is well documented. There are however competing theories concerning the effects of inflation. What Wikipedia should ask itself is this:

Should the encyclopedia support the mainstream view even though it is demonstrably wrong?

Misessus (talk) 12:46, 17 August 2010 (UTC)

The definitions of words change. One could make a point for moving this article to Price inflation, and creating Inflation as a disambiguation page, but one cannot deny that the mainstream definition of "inflation" is "price inflation". We (Wikipedia) should not use words differently from the mainstream, although we should note alternate definitions. — Arthur Rubin (talk) 13:29, 17 August 2010 (UTC)

By the way, there is an Inflation (disambiguation) page, and it does provide a link to Monetary inflation, and it notes that what is usually nowadays called 'inflation' is also sometimes more specifically called 'price inflation'. Rinconsoleao (talk) 10:52, 18 August 2010 (UTC)

I remember that this type of article restructuring was discussed some time ago. I remember being in favour of it to start with and then being persuaded otherwise, although I no longer remember the specific arguments. I am sure it is in the archive somewhere. It would be worth looking at why this was not agreed on last time before restarting any serious discussion on it again.

Putting Monetary Inflation as a specific item in the disambiguation at the start of the article seems reasonable to me. --DanielRigal (talk) 16:13, 17 August 2010 (UTC)

It is true that definitions of ordinary words change over time. However, scientific terms seldom change. But even so, we can at least establish that there is no dispute as to the original meaning of the word inflation. Going back to my original thought experiment, the correct analogy would be the following:

If the great majority of people became overly religious and went back to the old church doctrine according to which the sun revolves around the earth, this view would soon become mainstream. There would be many who knew that this was wrong, but they'd be the minority. In that scenario, would Wikipedia change its entries on related subjects, so that most attention would be given to the view that the earth is the centre of the universe, with only a small section devoted to an opposite "theory"?

According to current rules and principles, the answer is yes. The real question is: Why would it be harmful to moving this article to Price Inflation as a disambiguation page? As I've noted before, there is no theory of inflation regarding what inflation is. There are many types of inflation, price inflation and monetary inflation being the most well known. Wikipedia would be much more informative and correct in having one article called Price Inflation, which defines the term a rise in the general price level, an one article called Monetary Inflation, which defines the term as an increase in the supply of money. Plain and simple. Then you can add whatever sections you want on the consequences of both types of inflation, what causes prices to rise, in what ways can the money supply increase and so on. The articles would be much more readable and generate much less controversy. What possible objection can anyone have to this compromise? Misessus (talk) 00:03, 18 August 2010 (UTC)

Price inflation already redirects here. Please read the Manual of Style on naming WP:NAME, where it states that, "Articles are normally titled using the name which is most commonly used to refer to the subject of the article". Almost everyone uses the term 'inflation' to refer to a general increase in price level, very few use 'price inflation', therefore, this article is correctly named. LK (talk) 04:12, 18 August 2010 (UTC)

The article may be correctly named according to the manual, but it could be more correct from a scientific point of view. Maybe it is time to start discussing the rules and principles of Wikipedia itself, as they seem be in dire need of updating. Is there a forum for that discussion?

Misessus (talk) 06:53, 18 August 2010 (UTC)

Goodluck with that. In my experience, the community takes a dim view of people trying to change policies to further their particular causes. In the mean time, those of us who think that the rules are working just fine will continue to follow the policies and guidelines as currently written. LK (talk) 07:01, 18 August 2010 (UTC)

A long time ago, the section "related definitions" was close to the beginning of the article. It distinguished between inflation, deflation, disinflation, etc., and also mentioned how the word "inflation" has been used to refer both to "price inflation" and to "monetary inflation". I think it would be an improvement if "related definitions" were moved prior to the "history" section. The "related definitions" section should mention that most economists now use "inflation" to mean "price inflation", but that it was earlier used to mean "monetary inflation", and that some schools of thought still use the word in this way. A link to "monetary inflation" should be included in the "related definitions" section. Rinconsoleao (talk) 08:53, 18 August 2010 (UTC)

The opening sentences of the history section serve the same purpose, so I don't see a pressing need for this, although I have no objections either. --DanielRigal (talk) 09:03, 18 August 2010 (UTC)

"Related definitions" should probably come earlier, because it serves primarily to disambiguate a bunch of closely related concepts (which should include the price inflation/monetary inflation distinction). Related definitions usually come very near the lead in Wikipedia articles. Here they have gotten crowded out by the history section precisely because "history" addresses the debate about how the use of the word "inflation" has changed over time, and has grown over the course of edit wars. But the simple fact that competing definitions exist should come earlier, without the need for a long historical discussion. Rinconsoleao (talk) 09:22, 18 August 2010 (UTC)

Place "Related definitions" second.

Following my previous comment, I would suggest moving the first two sentences of the 'History' section to the 'Related definitions' section. And I would suggest placing 'Related definitions' immediately after the lead section, before 'History'. That way related concepts are spelled out at the earliest possible point in the article, including the price inflation/monetary inflation distinction that causes so much debate.

The following is my suggestion for the section. I removed one sentence on 'Asset price inflation' that is covered adequately elsewhere in the article. Rinconsoleao (talk) 13:30, 19 August 2010 (UTC)

The term "inflation" originally referred to increases in the amount of money in circulation, and some economists still use the word in this way. However, most economists today call an increase in the money supply monetary inflation, to distinguish it from rising prices, which may also for clarity be called 'price inflation'. Economists generally agree that monetary inflation is one of the main causes of price inflation.

Other economic concepts related to inflation include: deflation – a fall in the general price level; disinflation – a decrease in the rate of inflation; hyperinflation – an out-of-control inflationary spiral; stagflation – a combination of inflation, slow economic growth and high unemployment; and reflation – an attempt to raise the general level of prices to counteract deflationary pressures.

Since there are many possible measures of the price level, there are many possible measures of price inflation. Most frequently, the term "inflation" refers to a rise in a broad price index representing the overall price level for goods and services in the economy. The Consumer Price Index (CPI), the Personal Consumption Expenditures Price Index (PCEPI) and the GDP deflator are some examples of broad price indices. However, "inflation" may also be used to describe a rising price level within a narrower set of assets, goods or services within the economy, such as commodities (including food, fuel, metals), financial assets (such as stocks, bonds and real estate), services (such as entertainment and health care), or labor. The Reuters-CRB Index (CCI), the Producer Price Index, and Employment Cost Index (ECI) are examples of narrow price indices used to measure price inflation in particular sectors of the economy. Core inflation is a measure of inflation for a subset of consumer prices that excludes food and energy prices, which rise and fall more than other prices in the short term. The Federal Reserve Board pays particular attention to the core inflation rate to get a better estimate of long-term future inflation trends overall.

I think this looks good. To be consequent, however, I suggest adding decreasing money supply as the alternative meaning to deflation. This because it is already stated that inflation normally refer to either rising prices or increasing money supply. From that follows that deflation means either falling prices or decreasing money supply. Misessus (talk) 20:26, 19 August 2010 (UTC)

In most articles with a history section, the history section comes first. I see no reason to deviate from the usual order here. Also, I have not seen any reliable source stating that deflation is a decrease in money supply. One is required before introducing such an assertion into the article. LK (talk) 00:02, 20 August 2010 (UTC)

I think it would be useful in this case because (1) the definition stirs up so much controversy with a certain subset of users and (2) for ordinary users with little background in economics there are many, many concepts related to inflation that people get confused about. Disambiguating all that before plunging into 'History' would make the article more user-friendly.

Another reason to make the rearrangement I suggested is that currently the purpose of the 'History' section is unclear. Is that section intended to describe the history of the definition of inflation? The first sentences (about 'monetary' vs. 'price' inflation) make it seem so. Or is it intended to describe the history of inflation itself? The paragraphs on gold and silver from the New World, or effects of the Black Death, make it seem that the section is about the history of inflation itself. Or is it intended to describe the history of theories about the causes of inflation? That's what the last two paragraphs seem to address.

So to better restructure the article, I would suggest moving the statements about the history of the definition into the 'Related definitions' section (which should therefore be placed second). Discussion of the history of the theory would be integrated into the theory sections that follow below. The 'History' section would then discuss the history of inflation itself, which would be more in line with other Wikipedia articles.

By the way, a section on the history of inflation is obviously incomplete without a paragraph noting that since the introduction of fiat money, inflationary episodes have become much more severe. Should discuss episodes of hyperinflation, such as Weimar Germany.

Further comments appreciated. If I don't get objections, I will make these changes myself. Rinconsoleao (talk) 14:47, 6 September 2010 (UTC)

As for 'deflation', of course those who use 'inflation' to mean an increase in the money supply use 'deflation' in the opposite sense, as Misessus' example below shows. But I would not be in favor of cluttering up the definitions section with such an obvious point. Rinconsoleao (talk) 13:40, 20 August 2010 (UTC)

See for instance "Is Deflation Really Bad for the Economy?" (http://mises.org/daily/4618) or page 74 of Murray Rothbard's "What Has Government Done to Our Money". Deflation is the opposite of inflation. If inflation is defined as increase in the money supply, how can deflation mean anything but a a decrease? Deflation is often used by mainstream economists when arguing that the US is not headed for runaway inflation. Their argument is that when e.g. a large number of mortgages default, i.e. loans go bad, this will contract the money supply and this contraction will surpass the moneyprinting by the Fed. Misessus (talk) 06:06, 20 August 2010 (UTC)

What now?

So as soon as the protection was lifted, BigK Hex removes almost the entire Austrian Section without any prior consensus whatsoever? What does the rules say about that? The last discussion was about a three sentence addition I made, which obviously was ok after I had explained it. How can it be allowed to remove so much without prior consent? Isn't that essence of vandalism? I will restore the Austrian Section to its August 17th format unless anyone besides BigK objects AND is able to actually argue for his case. Misessus (talk) 20:36, 30 August 2010 (UTC)

Well, if you want to be blocked that badly, Misessus, I'm sure I can oblige you. --SarekOfVulcan (talk) 20:44, 30 August 2010 (UTC)

If by "obviously OK" you mean that the last comments made to you (by editors besides myself) amounted to:

1. "In the mean time, those of us who think that the rules are working just fine will continue to follow the policies and guidelines as currently written." In response to your claim that it might be time to 'update' Wikipedia policy, and
2. "the ... sections of the article make perfectly clear that your argument here is mistaken" and
3. "For me, the addition seems ...expanded detail... rather than a necessary part of a summary overview.

For you to suggest that your edits were deemed "OK" is dubious at best, and disingenuous at worst. BigK HeX (talk) 21:09, 30 August 2010 (UTC)

Frankly, I find it absurd for Misessus to complain about my edit to that section not having "prior consensus" after he unilaterally modified the section almost immediately after a collaborative effort just unanimously satisfied a group of editors trying to strike a balance on the weight of that section. BigK HeX (talk) 21:33, 30 August 2010 (UTC)

Why is it so hard for you to have a rational, honest discussion? I responded to the claims and concerns raised by Rinco and corrected him on those claims and concerns, and as far as I can see, no one countered that response. Even in your edit you let the addition remain, but deleted the rest. That is what I found strange. The deleted text had a long standing consensus behind it, the debate was about the addition I made, and my case was obviously accepted, even by you.

From your typically hysterical response it is clear that you don't even know (or care) what you are talking about. I will restore the section to what it was prior to your deletion. It had a long standing consensus, and the three-sentence addition I made to that consensus text has been argued for.

To be completely honest, I find it very troubling that the people engaged in editing economics articles seem very unaware and quite frankly uneducated about the subject. Rinco's claim that sections of the article proves that my argument was mistaken is yet another proof of that. Your inability and obvious unwillingness to discuss the issue properly combined with your unilateral deletions prove that you should not have any part in editing this article. Misessus (talk) 23:12, 30 August 2010 (UTC)

RE: "Why is it so hard for you to have a rational, honest discussion?"

Oh... you wanted to engage in a rational discussion with me??? Forgive me if I came to a different conclusion when I read,

I will restore the Austrian Section to its August 17th format unless anyone besides BigK objects

If it wasn't clear already, my earlier comments were not directed at you. After you unilaterally decided to overturn the collaborative effort of 3 editors, it was exceedingly obvious to me that you support only your own edits. Participation by others in the community will ultimately resolve this dispute, and my comments here have been for any interested observers. You probably shouldn't expect me to direct any further comments on this particular matter to you as I have no interest in humoring your snide personal attacks. BigK HeX (talk) 23:39, 30 August 2010 (UTC)

I also support Morph's version of the article [1], and would oppose any addition to the AS section due to concerns about undue weight. LK (talk) 04:26, 31 August 2010 (UTC)

Attacks? You're hardly the one to talk, BigK. You've made your personal agenda known since day one. And what "collaborative effort" are you talking about? I made a very important and motivated addition to a consensus text, and I argued for it. Then you delete the whole section, but leave the addition I made. If there is anyone who's overturning collaborative efforts its you. But as said, you clearly have no interest in a balanced article, you're just interested in removing the Austrian School, something you pretty much said in your first comment on this talk page.

At any rate, this whole thing is getting ridiculous. No one has been able to present just cause for why the Austrian section should be almost non-existent. No matter all the references to Wiki-rules, this point has never been argued for properly. The briefest of glances at the world today tells anyone that the Austrian school has a disproportionate influence today, an influence that is growing every day. If there were any true concerns about undue weight and things like that, many other things would be discussed here, but the only thing discussed is the Austrian school. Any effort to protect the integrity of the article is met by hysteria, and should any editor dare to stick by what is right, he gets blocked. This is why Wikipedia has no credibility whatsoever when it comes to economics. Its bias is known to everyone, and this whole talk page is a testament to that bias.Misessus (talk) 00:36, 1 September 2010 (UTC)

It would be best if editors here observe the No Personal Attacks rule, and refrained from commenting about other editors. Please restrict all talk page comments to comments about the article and edits to the article, and refrain from commenting on an editor or group of editors. Failure to observe this policy can lead to the offender being blocked from editing Wikipedia. LK (talk) 09:07, 1 September 2010 (UTC)

Why have land prices have appreciated much faster than CPI?

In reading Henry George, who advocated a single tax on land in the late 19th Century, I noticed that land prices in the my area ca. 1985 were $1/acre and now they are several thousand per acre. This it more than 100 times the change in CPI. This is true throughout the U.S. Also, look at land prices in Japan at the peak in the 1990s. It seems that land prices rise exponentially in response to population growth. Does anyone know of any research on this?

The price rise in your area sounds drastic. On the edge of an expanding urban or industrial area, perhaps? $1/acre sounds very cheap.

You mention Japan as an example. However, after the pronounced peak in Japanese land prices, the Japanese population continued to rise as before. IIRC, land prices in Japan have not risen much faster than CPI for quite a while. Land prices are not simply a function of population; they are determined by complex supply and demand stuff. Regulation can make a big difference between countries, too. (For instance, in parts of Europe, a green field is relatively cheap but a green field with permission from local government to put buildings on it is expensive).

However, this shouldn't really be a forum for discussion of inflation as a concept. Do you have any suggestions for improving the article? bobrayner (talk) 22:06, 27 September 2010 (UTC)

Speaking As An Austrian...

I've read the debate about the Austrian School view with some interest. There's no doubt that the Keynesian/post-classical definition and explanation of inflation is wrong. Inflation is debasement of the currency, and there is no doubt about that to anyone who can do math and approaches the subject honestly.

Unfortunately it's not Wikipedia's job to say that. It's wikipedia's job to describe the received wisdom at the current time, because it is an encyclopaedia. If Wikipedia were to exist in 1890, it would say that science has shown that the black man and the feeble minded should be discouraged from breeding and it is the job of the White Man to benignly govern the lesser races. If Wikipedia existed in 1950, it would say that Plate Tectonics is a fringe theory with little support in the scientific community. It's not an encylopaedia's job to challenge the mainstream, it is an encyclopaedia's job to report the mainstream.

As such the majority of the article should report the Keynesian macroeconomic nonsense, until such time as the light of reason breaks over the economics profession. The Austrian view, unfortunately, only deserves minor reporting, like some crazy man in 1890 saying that blacks and whites are equal, or a loony Plate Tectonics crank in 1950. Austrians must prove the Austrian case in the wider world, and then Wikipedia will report that. That's my take on the issue, pain me as it does to say so.82.71.30.178 (talk) 00:20, 30 September 2010 (UTC)