Reflation

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Reflation

Government monetary action that causes a reversal of deflation.

Reflation

The act of a government printing money or taking similar actions to combat deflation. Deflation occurs when a recession is so severe that prices are reduced to inspire demand. This often leads to further economic decline. Reflation marks an attempt to increase money supply to increase spending in an attempt to spur growth. See also: Inflation.

reflation

an increase in the level of NATIONAL INCOME and output. A reflation is often deliberately brought about by the authorities in order to secure FULL EMPLOYMENT and to increase the rate of ECONOMIC GROWTH. Instruments of reflationary policy include fiscal measures (for example, tax cuts) and monetary measures (for example, lower interest rates). See also FISCAL POLICY, MONETARY POLICY, DEFLATIONARY GAP, DEMAND MANAGEMENT.
References in periodicals archive ?
As a consequence movements in the residual between the expenditure and reflated output estimate imply a fault with the expenditure data, while movements in the residual between income and reflated output point to a problem with the income data.
Industry output for 1981 expressed in 1977 dollars (see next paragraph) is multiplied by the 1977 direct requirements per dollar of industry output to obtain 1981 constant-dollar intermediate consumption, and the results reflated by commodity to current dollars.
Second, because the commodity composition of intermediate consumption is not available, constant-dollar consumption is estimated using the 1977 consumption proportions and reflated to current dollars.