Skip to content
Navigating a New Political Landscape: View real-time updates about the impact of and Northeastern’s response to recent political changes.
Apply
Stories

How inflation is influencing the way we think and behave

People in this story

(Gaya Gupta/The Washington Post via Getty Images)

Driven largely by soaring gas prices, inflation reached levels not seen in decades over the last year, according to new Consumer Price Index data. Prices at the pump helped accelerate inflation to 8.6% for the 12 months ending in May, CNN reports—and there seems to be no end in sight. Such price disruptions are sure to have impacts on consumer behavior. Market-watchers have suggested that an “inflationary psychology” is starting to set in, which describes a situation wherein consumers expect future prices to be higher than they are at present, creating less short-term resistance to spending.

With some consumers willing to spend more to get ahead of inflation, firms are equally willing to raise wages, leading to fears of a “wage-price spiral,” or what’s referred to as inflation’s self-fulfilling prophecy. Inflationary psychology may just be one ingredient propelling a wage-price spiral, says Rory Smead, associate professor of philosophy at Northeastern, who researches the evolution of social behavior. But the situation is manifold, and it’s hard to predict how consumers will respond to the economy-wide price surge. 

Continue reading at News@Northeastern.

More Stories

A view of the Supreme Court at dusk, January 31, 2017 in Washington, DC. President Donald Trump will announce his nominee for the Supreme Court on Tuesday night.

Supreme Court set to rule on five big cases as term winds down over the next few weeks

05.08.2025
Clouds pass over the St. Peter Basilica at the Vatican, Tuesday, May 6, 2025.

Why ‘theopolitics’ and not nationality is likely to decide the next pope

05.08.2025
Jiaao Yu a sociology doctoral student at Northeastern, poses for a portrait on Thursday, May 1, 2025.

How do friends impact youth non-suicidal self-injury? Northeastern researcher explains

05.08.25
Student Stories