Stagflation is an economic event in which the inflation rate is high, economic growth rate slows, and unemployment remains steadily high. The Stagflation is presented a dilemma for economic policy, since actions intended to lower inflation may exacerbate unemployment that is often caused by a rise in the price of commodities, such as oil. Stagflation occurred in the 1970s following the tripling in the price of oil. A degree of Stagflation occurred in 2008, following the rise in the price of oil and the start of the global recession.
Reference Definition by Investopedia: Stagflation is characterized by slow economic growth and relatively high unemployment—or economic stagnation—which is at the same time accompanied by rising prices (i.e. inflation). Stagflation can be alternatively defined as a period of inflation combined with a decline in the gross domestic product (GDP).
Related Definitions in the Project: The Commercial Definitions
