chapter  XXIV
18 Pages

Price Stability versus Full Employment Conclusion

The monetary and fiscal policies which we have been examining in the preceding chapters of this part are designed solely as temporary measures to cut short the possible cumulative inflationary or deflationary effects of unanticipated fluctuations in the total demand for goods and services; we have argued that they must be applied promptly and on a scale which depends not only upon the current level of inflation or deflation, but also upon the degree to which an inflationary or deflationary situation has persisted in the past and the speed with which it is increasing or decreasing in intensity. It remains only to consider what measure of the degree of inflationary or deflationary pressure of demand should be used for this purpose.