ABSTRACT
The study of the dynamic formulation mechanism of inflation is of great significance to the scientific formulation and implementation of macroeconomic policies, especially monetary policies. The dynamic evolution of inflation is related to predictions about future inflation as well as the governance and regulation of inflation or deflation. It is worth noting that as for the research on how inflation is formed, the existing literature mostly distinguishes different types of inflation from the perspective of its driving factors, such as “cost-driven,” “demand-driven,” and “mixed” inflation formation mechanisms. Although there are two disparities or differences in the multiple logics of the dynamic formation mechanism of inflation, they are only different in the setting angle of the analytical framework, and are not exclusive to each other.
