Deflation, demand deficiency and policy propose : the experience of China
Date of Issue2000
College of Business (Nanyang Business School)
To most of Chinese consumers, deflation is a completely new and somehow, strange concept as they had been experienced a long period of inflation under the economic pressure of short supply and rationing of living necessities. In the past three years, deflation has brought much unfavorable influence to economic development. As a result, it has become a focus problem which the Chinese government and consumers start to notice its importance. Deflation is usually considered as the indication of economic depression. If it cannot be contained in time, economic development in China and particularly the Chinese industrial economy will suffer from stagnation. Prolonged depression of the economy under deflation may lead to overall economic depression too.
Nanyang Technological University