Inflationary realities: Lessons from Iran’s inflationary experience for the Western consumers

Abstract

In response to the recessions of 2008 and 2020, governments and central banks injected massive amounts of liquidity into their respective economies. The subsequent monetary devaluation resulted in a number of developed nations experiencing their highest inflation levels for 40 years, with many consumers living through double-digit inflation for the first time. Although monetary authorities claim to have inflation under control, high chronic inflation nonetheless remains a possibility. This paper considers the case of Iran, a country with chronic high inflation, and through a qualitative study explores the experience of consumers and their adaptive strategies in such economic circumstances. For Western consumers, businesses and policy makers, it will be illuminating to grasp the impact and consequences of failed monetary policies and ongoing inflation on consumers’ lives and society at large.