There's a difference between decreases in the price of specific goods that comes about due to technology, and deflation that comes about due to monetary policy.
That I can think of, the obvious difference is that the second one almost definitionally means a steady decrease in nominal wages. This seems like a perverse incentive - if I sock away my first paycheck flipping burgers under my mattress and do nothing with it for 50 years, a deflationary regime means I can take it back out and buy a lot more with it than someone with their first paycheck flipping burgers today.
> the obvious difference is that the second one almost definitionally
People said similar stuff about negative interest rates, yet they were rolled out and kind of worked around the world. I'm not buying this defense of inflationism.
The prevailing consensus is that interest rates and inflation are inversely correlated, so "negative interest rates worked out fine" isn't a rebuttal to that.
> if I sock away my first paycheck flipping burgers under my mattress and do nothing with it for 50 years, a deflationary regime means I can take it back out and buy a lot more with it than someone with their first paycheck flipping burgers today.
Thats still true with inflation too. No idea what your point is.
How is that true with inflation? Under the exact same scenario but with an inflationary monetary policy, any money you sock under your mattress dwindles down to a fraction of its purchasing power over the course of many decades if it is not invested into a vehicle that generates returns. That could be equities, bonds, housing, or even an interest-bearing savings account. The point is that an inflationary regime incentivizes investments as a means of wealth preservation.
So you would have to assume that investments would be worthless in a non inflationary state which is a big stretch of the imagination. You think there were no tech revolutions and investments going on while everyone was at the gold standard?
Non-inflationary and deflationary are different terms, with my point strictly referring to the latter, so it would help for you to specify.
Deflation means what it sounds like - goods, assets, wages generally trending downward over time. Yes, I posit that this has a chilling effect on recirculating money into investments, because you get worse odds on a positive return on any investment you make vs. just doing nothing.
That I can think of, the obvious difference is that the second one almost definitionally means a steady decrease in nominal wages. This seems like a perverse incentive - if I sock away my first paycheck flipping burgers under my mattress and do nothing with it for 50 years, a deflationary regime means I can take it back out and buy a lot more with it than someone with their first paycheck flipping burgers today.