Speech

The Evolution of Technological Disruption

Abstract: The economy has seen a number of disinflationary innovations in recent years. These innovations put “the wind at our back” when it came to containing inflation. But we've been through quite a storm over the last two years, and it is appropriate to ask whether anything has changed and if the wind has shifted in a more inflationary direction. We’ve seen vulnerabilities associated with a globally complex supply chain, investments in renewable energy, and changing demographics that may shift labor from being abundant to being scarce, all of which could result in rising cost pressures. It’s possible that we could return to pre-pandemic wind conditions, but what if we are in a new era – one in which we face inflationary headwinds? Our goal, 2 percent target inflation, wouldn’t change, nor would our longer-run ability to meet that goal, but the appropriate path to achieve it could.

Bibliographic Information

Provider: Federal Reserve Bank of Richmond

Part of Series: Speech

Publication Date: 2022-10-03