Americans want prices to go down, but deflation could spark a wave of unemployment, top economist Paul Krugman says

Paul Krugman warns that achieving lower prices post-pandemic could trigger deflation, historically leading to high unemployment rates.

Deflation necessitates wage cuts, as seen in the Great Depression and Greece's debt crisis, causing spikes in unemployment.

Krugman advises against pushing for pre-pandemic price levels, noting the current state of low inflation and unemployment as a positive outcome.

While prices are still high, US seems to be experiencing a 'soft landing' with low inflation and unemployment rates.

Read at Business Insider