Features of Deflation


Features of Deflation:


  1. Deflation is a monetary phenomenon caused by a fall in the supply of money.
  2. The fall in prices level is marked and persistent.
  3. The fall in prices is not confined to any specific goods, but extends to all goods. In other words, there is a fall in the general price level during deflation.
  4. During deflation, the fall in the general price level is accompanied by a fall in rise in the value of money.
  5. Deflation is man-made. It arises out of the government, the Central Bank, Commercial Banks, Businessmen, etc.

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