kustannusinflaation

Kustannusinflaatio, also known as cost-push inflation, is a type of inflation that occurs when the prices of goods and services rise due to an increase in the costs of production. This differs from demand-pull inflation, which is driven by an increase in aggregate demand. Factors that can lead to cost-push inflation include rising wages, increased raw material prices, higher energy costs, and increased taxes or regulations that add to business expenses.

When the costs of producing goods and services go up, businesses may pass these higher costs onto consumers in the form of higher prices to maintain their profit margins. For example, an increase in the price of oil can lead to higher transportation costs for virtually all goods, which in turn can result in higher prices for consumers. Similarly, if labor unions successfully negotiate for higher wages, businesses may increase product prices to cover the added labor expense.

Cost-push inflation can be particularly challenging to manage. Unlike demand-pull inflation, which can sometimes be addressed by moderating demand, cost-push inflation involves supply-side issues. Policies aimed at reducing production costs, such as subsidies for energy or raw materials, or measures to increase competition, might help mitigate cost-push inflation. However, these policies can have their own economic implications. Persistent cost-push inflation can lead to a wage-price spiral, where rising prices lead to demands for higher wages, which in turn further increase production costs and prices.