@dalfen Apparently, large corporate profits have a negligible effect on rising inflation.
@dalfen Thank you for providing the link.
I would draw your attention to the IMF's 2023 working paper titled 'Euro Area Inflation after the Pandemic and Energy Shock: Import Prices, Profits and Wages' which states that
"Accounting explicitly for the import price shock through a
consumption deflator rather than GDP deflator decomposition, we find that import prices account directly for 40 percent of inflation on average since 2022. But the role of domestic profits remains significant, accounting for just below 45 percent and labor costs for 25 percent of inflation."
@bibliolater Are you in Europe? I sent our BLS (US) info about producer prices— considering the cause of persistent inflation here in the US. (Producer prices are high and all players down the supply chain want to make a profit, which affects the prices all the way down the line to the consumer at the end.)
Without a doubt, the quest for profit takes a front-row seat in a capitalistic economy.
Thank you for the link! I am eager to learn more about the EU’s import policies, etc.
@dalfen "Are you in Europe?"
I am in a country (U.K.) that is geographically in Europe but that is not part of the European Union.
@bibliolater Ah gotcha 🙂
@dalfen So paradoxically I am both in and out of Europe.
@bibliolater Yes. You have witnessed significant changes over the past few years with UK’s separation from the EU— How has it affected your daily life?
@undefined @dalfen For most the nation has become poorer. Brexit added a layer of bureaucracy and controls to trade betwixt the UK and the EU that have not been conducive to business.
@bibliolater Oh I'm sorry to read that 😕
@bibliolater I hear you. I see some calls for corporate restraint, but the corporate world also has a lot of power over what we see.
Producer prices are still high in general across the board. Everyone down the supply chain wants to make some profit.
The PPI for both goods and services has been on the rise in the last 12 months overall. The PPI for goods went down a small amount with the last publication, but services increased.
https://www.bls.gov/pPI/