The influence of inflation on the standard of living of the population
Maria Cheremshuk
National University of
Food Technologies, Kyiv, Ukraine
Inflation, as the economic phenomenon existed long
time ago, and this term purchased wide distribution in economic literature
after First World War.
Nowdays a question of low and non-destructive
inflation rates is actual at the national market, so as it substantial growth
negatively affects all parties of socio-economic life in Ukraine. And the economy growing depends on the
decision of this task, monetary and
currency-financial policy, profitability of enterprises.
The problem of inflation in Ukraine was studied in
labours of A. Gal'chynskyi [1], Levchenko Z. [2], V. Kalyuzhnyi [3], Lysytskogo
V. [4], Lichnarovskyi A [5], Doroshenko I. [6], Scherbaka A [7], and others.
Each of these scientists have their own point of view at this problem. For
example, A. Gal'chinskiy [1] explains the high level of inflation the
artificially overpriced profits of population, and V. Kalyuzhniy [3] considers
that inflation in Ukraine has monetary
character.
The inflation itself consists of depreciating of the
national currency in relation to commodities, services and foreign currency,
which keep stability the purchasing power.
The major of the external factor of the growth of
inflation unjustified setting of the exchange rate when converting currencies,
which leads to significant fluctuations in exchange rates.
Also, we can mention the following internal causes of inflation in
Ukraine:
•- exceeding the rate of income growth over
the growth of industry;
•- significant increase
in energy costs;
•-
unstable political situation in the country;
•-
national budget deficit
All these factors which influence the inflation
negatively affects all aspects of social and economic level of life. The Inflation results the following: devaluation of
savings; hidden confiscation of funds through the introduction of innovations
in the tax system; redistribution of income and wealth; instability and lack of
economic information; decrease of real interest; increase of prices for food;
increase in the number of unemployed; reduction of income; decline in living
standards.
According to scientists [1], the main indicators of
integrated assessment of living standards in terms of inflation are: real
average salary, real average cash income per person, concentration coefficient
of income, the excess of average cash income over expenses, the ratio of
average cash income and living minimum, minimum consumer budget.
In terms of inflation there is a growth of negative effects of social and economic polarization of
society in terms of life level, depopulation, deterioration of the quality
characteristics of life, their physical, moral - ethical health, inefficient
use of professional qualification potential, increase in underemployment and
unemployment.
So here we can make a conclusion that inflation has a
significant impact on the standard of living and to overcome this problem we
need to work proactively and we need to struggle against its causes rather than
consequences.
And if there are inflationary processes we should
develop active social policies to improve people's lives and this is possible
on the basis of the formation of the following strategic areas: social
reorientation of processes of economic reform aimed at improving living
standards; taking into account the economic interests of all social groups
distinguishing of the most unprotected in the social aspect; providing minimum
social guaranties; identifying the role and place of each category of
population in the formation of a market economy based on reasonable
classification of structure of the society.
1. A. Gal'chynskiy
Stabilizaciya hryvnyas: problems and prospects of //Visnyk NBU. - 2002. - ¹7. -
P. 9-13.
2. Does inflation grow -
what to do?/ Z. Levchenko// securities of Ukraine - 2008 - ¹ 11 - P. 22-23.
3. V. Kalyuzhniy
Mekhanizm of development and counteraction inflation in Ukraine//Ekonomist -
2008 - ¹ 6. - P. 16-22.
4. V. Lysytskiy Inflyaciya
is an immortal problem of ekonomik//
Personal Plus. - ¹ 44
(247). - P. 12.
5. Development of
inflation in Ukraine in modern period/ A. Lichnarovska// the Scientific
revisions of young people - to the decision of problem of European integration.
zb. sciences. of articles in 2 volumes - 2008
- P.162-164.
6. Development of
inflationary processes and their globalizations is on skladova/ of I. Doroshenko// International finances -
2008 - ¹ 6 - P. 10-16.
7. How to tame inflation
in Ukraine?/ A. Scherbak// Economist - 2008 - ¹9 - P. 43-45.