Letter to the editor: Inflation and competition

Regarding the article “Inflation explained: Cheaper consumer electronics an outlier among industries” (Sept. 30, TribLive): This really has nothing to do with inflation, which is a purely monetary phenomena. This is about competition, which continues to operate in any environment. No matter what the product or service is, if somebody can figure out how to do it better or cheaper, its price will fall relative to other prices. This can take days or years, but it happens.

Data analyst Elizabeth Renter expects prices to rise as a result of economic growth, but she is wrong. Producers try to improve their positions by making it better or selling it cheaper, and that puts downward pressure on prices. In the absence of monetary inflation, growth causes prices to fall.

Robert Peirce

Venetia