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Paulson: Does Experiencing High Inflation Change Economic Behavior?
For many years, most Americans rarely had to worry about inflation. The postpandemic era disrupted that experience, with elevated inflation impacting both households and businesses. Necessities—such as food, energy, housing, and other commonly purchased goods—became more expensive, and inflation entered everyday conversations. A growing academic literature shows that individual behavior can be shaped by the events people experience. The widespread experience of inflation raises an important question: Will living through this period of elevated inflation change economic behavior—and, if so, what does this mean ... (full story)