NPR.

A wage price spiral.

The very mention of this phrase strikes fear into the hearts of central bankers everywhere,

because a wage price spiral is the nightmare scenario for inflation run a muck.

And you have probably seen this phrase in Vokten, news stories uttered by various experts

and policy wonks or economics bloggers who are trying to explain how inflation could

run out of control.

Here is just one example from our show, it was back in fall 2021.

We did a Halloween show, it was a bit of a kind of fictional radio play in which a demon

described how inflation erodes the value of money and how that contributed a wage price

spiral.

The value has eroded and as people realize that, thus spending money even quicker before

it loses even more value, they'll demand higher wages which will make businesses raise

their prices.

And that will trigger more inflation.

The cycle goes on and on and on and on until the money is worthless.

So bit of a nightmare, but you know there is actually a fair bit of debate over how

real a threat wage price spirals are.

For some economists, wage price spirals are not some law of economics and for others they

go as far as to say it's a myth.

This is the integrated front line at money I'm Diane Woods.

And I'm Adrienne Ma.

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