Demand Pull Inflation

Market Terms

We don't know everything about the markets.  We're just devoted to learners.  Taken from those smarter than ourselves, here's how we define Demand Pull Inflation.

An overall increase in the cost of living that occurs when demand outpaces the available supply of a consumer good.  This form of inflation is a key tenant of Keynesian economics, describing it as a result of an imbalance in the aggregate supply and demand.  This is a common form of inflation, as when the aggregate demand outweighs the aggregate supply, prices rise.  Common causes of demand-pull inflation are a growing economy, inflation of assets, government spending, expectation of future inflation, and expansion of the money supply with out subsequent increase in goods.