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Why Lower Retail Prices Hurt the Economy

Published on: 2015-02-05

Inside the Aisle reports:

Using a cartoon (in the tradition of Schoolhouse Rock), Robert Krulwich artfully explained why retail price wars threaten to deepen the recession.



Our take:

While the theory is controversial, the underlying theory is sound. Whether you think you agree or not with the premise, the cartoon is definitely worth watching. It's a quick introduction to the concept of deflation, and why it causes lots of problems for the economy.


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