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das monde and ThatBritGuy seem to be agreeing that the cause of inflation is entrepreneurs raising prices and blaming it on the increasing costs of rising wages they have to pay.

But das monde wrote that prices in the Baltics did not increase until the last months of the boom, which means (if I understood correctly) that wages did not rise until the last months of the boom either (even though expanded credit 'increased their nominal wealth and monetary volume enormously' -- I guess 'their' includes both entrepreneurs and workers).

So what I do not understand is what forced entrepreneurs, after a long period of not raising wages, to do so at the end of the boom like that?

The West won the world not by the superiority of its ideas or values or religion, but rather by its superiority in applying organized violence.

by marco on Wed Sep 2nd, 2009 at 10:33:42 AM EST
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