Wage-Push Inflation: Its Meaning and Control

Abstract

It is the opinion of the present writer that if the tools of monetary and fiscal policy are refined to reduce time-lags, and if the attitudes of those administering policy change, the situation would be much improved. If both the tools and the attitudes were present to act immediately upon a wage-push inflation, the goal of both full-employment and price stability could be achieved. However, without these modifications, the present "either/or" type of situation will continue. Price stability will be achieved only at the cost of unemployment and full-employment will be achieved only at the cost of unstable prices. With modifications in monetary and fiscal policy however, the goal of full-employment with reasonable price stability can be achieved. 20 We will not go into a complete discussion here as to specifically how they may be refined. One example of a refin emen tin f i s cal pol icy , however, mig ht be a con gres sf 0 na1 '