Abstract
In this paper Prof. Huerta de Soto attacks the current anti-deflationist paranoia from the point of view of the Austrian School of Economics. After discussing three different types of deflation (that deliberately provoked by the authorities, the inevitable credit deflation after a crisis, and the good deflation based on increasing productivity), Huerta de Soto answers one by one the standard arguments normally given against deflation, concluding that in many instances they are defended by specific political and pressure groups that only benefit from inflationary environments. Inflation is always very popular and precisely for that reason is so perverse and does so much damage. Deflation, on the contrary, is not popular but it is very necessary to promote the necessary economic reforms and to discipline the behavior of all the agents operating in the economy and the political arena.
Closing speech at the Seventh Spanish Conference on Austrian Economics. These remarks were delivered Thursday, June 12, 2014, in Madrid, and have not been published before.
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Huerta de Soto, J. (2018). Anti-deflationist Paranoia. In: Godart-van der Kroon, A., Vonlanthen, P. (eds) Banking and Monetary Policy from the Perspective of Austrian Economics. Springer, Cham. https://doi.org/10.1007/978-3-319-75817-6_10
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DOI: https://doi.org/10.1007/978-3-319-75817-6_10
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