Inflation is a worldwide phenomenon that has been affecting the global economy for centuries. It is a phenomenon that causes prices to increase and the purchasing power of money to decrease.
Inflation can be defined as an increase in the general price level of goods and services over time, or equivalently, as a decline in the purchasing power per unit of money. In other words, inflation happens when there is too much money in circulation and it loses its value.
Inflation can be caused by many things:
- An imbalance between supply and demand;
- A change in relative prices;
- Monetary policy;
- Government spending;
- Changes in the quality of goods or services, etc.
1-What are the Symptoms/Effects of Inflation in Society?
It can be argued that one of the symptoms of chronic inflation is when prices increase at a higher rate than wages.
When inflation rates rise, there are three major effects on society:
- The purchasing power of the currency declines,
- Interest rates rise, and
- Investment opportunities decrease.
In many countries in Africa the effects of inflation are already noticeable. From oil to food supply (especially flour) the prices of items are going high. In Ivory Coast, the 50 kg flour sack from 11.000 went to 23.000XOF. In Togo, the oil price was raised twice. Other increases have been observed in many countries.
2-How Does Inflation Affect the Average Joe?
Inflation is measured by calculating the percentage change in a price index from a specified starting point. The most common measure of inflation is the consumer price index (CPI). This measures changes in prices of goods and services that consumers purchase on a regular basis, such as food and clothing.
Inflation affect the average person is these ways :
- Effects of poverty are increased
- There is more precariousness in the population
- Inflation may affect growth positively
- The competitiveness of companies are reduced
3-The Solutions to Curb Inflation with Regular People Solutions
A solution may be to increase supply by encouraging more production and creating new jobs.
On the other hand, the solutions to curb inflation with regular people, is to take control of our money supply and invest it wisely. For instance, you can increase your money earning ability by working online and learning to invest wisely.
There are two ways that you can make money online, one is by working for someone else and the other is by starting your own business. This way of making money online can be done through freelancing or through a remote job. When you work for someone else, they pay your salary and they provide you with the tools and resources that you need in order to do your job. The second way of making money online is by starting your own business. This way of making money online can be done through an e-commerce website or through blogging with affiliate marketing as a side hustle.
There is a lot of documentation to learn freelancing online. It is nowadays a very good way to earn more money, thus to alleviate the effects of inflation on ones personal life.