Journal Press India^®

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In general, inflationary situation arises when aggregate demand increases more than aggregate supply. The imbalance between these market forces are caused by several monetary and non-monetary factors. This is what we all know about theoretical frame work of the concept ‘inflation’ but the practical aspects of inflation are different. The present ‘world inflation situation’ is quite different from the past one; despite various efforts by government through economic policy, the inflationary situation has grown worse. In this context, it is necessary to find out the causes for mounting inflation rate making all anti-inflationary measures ineffective. There is a need to realise the fact that whether inflation is a myth i.e. the saga of historical events like war-inflation, cost-push and demand-pull inflation, monetary-inflation, tax-induced inflation, etc. or a miracle i.e. the manipulation of policy makers, and market big-bulls. This is the contention of my theory: Manipulation theory of inflation. This paper focuses on some select factors and their contribution to inflation and also suggests some measures to be incorporated in the government’s economic policies to deal with it. Besides, I intend to make my research work of societal relevance.

Keywords

Inflation rate, Manipulation theory of inflation, Supply side analysis, Price inflation, Market Big Bulls

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