stagflation

American  

[stag-fley-shuhn] / stægˈfleɪ ʃən /

noun

1. an inflationary period accompanied by rising unemployment and lack of growth in consumer demand and business activity.

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stagflation British  

/ stæɡˈfleɪʃən /

noun

1. a situation in which inflation is combined with stagnant or falling output and employment

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stagflation Cultural  

1. An economic phenomenon of the late 1960s and 1970s characterized by sluggish economic growth and high inflation. The word is a blend of stagnation and inflation.

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Etymology

Origin of stagflation

First recorded in 1965–70; stag(nation) ( def. ) + (in)flation

Explanation

Economists use the term stagflation to describe a situation in which prices and unemployment are both high, and economic growth is slow. This economic situation is an unfortunate combination of longterm inflation (when the cost of living keeps going up) and a stagnant economy. The term stagflation was coined in the 1960s, but it became widely used by economists in the 1970s, when an oil crisis caused just this situation in many countries worldwide. Prior to that period, most experts believed that high inflation could only lead to low rates of unemployment.

Example Sentences

See Examples For:

stagflation

If central banks cut interest rates to boost growth during a period of stagflation they run the risk of further aggravating inflation.

From Barron's ● Jul. 23, 2026

The economy was undergoing stagflation and the public fisc had just been rescued by the International Monetary Fund.

From The Wall Street Journal ● Jun. 1, 2026

He warns that if the AI boom disappoints after activity is pulled forward, it could result in an overheated economy and stagflation.

From Barron's ● May 9, 2026

The parallels to today, while not exact, are interesting; along with the Iran hostage crisis, stagflation ended up destroying Jimmy Carter’s presidency.

From Salon ● May 7, 2026

Galbraith provides a quite accurate and chilling history of how prosperity gave way to stagflation as a result of misguided policy - and he shows how economists provided the misdirections and the apologies.

From Definition & Reality in the General Theory of Political Economy by Colignatus, Thomas