Academic Scientific JournalsImpact of Expected Risks of Wage-Price Spiral on Sustainable Economic Development of the State
Keywords:
Inflation, wages, sustainable development, wage-price spiral, labor productivity, economic shocksAbstract
Aim of the article. The examination of spiral development hazards is crucial for inflation analysis and forecasting. The growth of the wage-price spiral danger is seen by international organizations as one of the major concerns. Because of this, the paper's goal is to examine the dynamics of changes in prices and wages in order to identify warning signals of impending danger and provide suitable remedies.
Methods. Quantitative analysis of primary, secondary and tertiary sources is used in this paper. It was possible to find and confirm common findings in the research process by comparing data obtained from different types of sources through the triangulation technique.
Results and Conclusions. Recent labor market changes and potential pay pressure on prices have gained prominence in terms of local inflation, raising the possibility of a wage-price spiral. The dangers associated with inflation are still very considerable, even with the recent improvements. It is anticipated that the industrialized nations' central banks would tighten financial conditions even further in the context of a high rate of inflation worldwide. For nations with emerging and expanding economies, the global financial conditions have tightened dramatically, increasing the sovereign risk premium and raising the possibility of further inflationary pressure. Georgia is susceptible to world events since it is a tiny nation with an open economy. Furthermore, recent pay growth in the local labor market has outpaced productivity growth, which highlights labor market inflationary pressures. Thus, maintaining low inflation expectations continues to be a significant task.
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