comment on the macroeconomic debates your peers chose. Provide examples from current economic news about the macroeconomic policy debate, and comment on the nature and tenor of the discourse surrounding the different debates.

The debate I chose is "Should the Central Bank aim for Zero Inflation?" Considering the continual rise in prices, inflation appears to be an ongoing concern, affecting many individuals. According to Mankiw (2021), the process of reducing inflation may initially lead to periods of high unemployment and low output, as illustrated by the Philips curve. However, this effect is typically temporary, with the benefits of lower inflation outweighing the short-term costs. Low inflation offers lasting advantages by preserving the purchasing power of money, enabling individuals and businesses to make long-term decisions confidently. Lower inflation mitigates the distortions caused by inflationary expectations, thereby improving the efficiency of resource allocation and investment. Lower inflation also tends to boost consumer confidence,enabling individuals to have more purchasing power for goods and services. Lower inflation often coincides with reduced nominal interest rates, allowing for more consumers to borrow and finance significant purchases such as cars and homes. Inflation significantly impacts the daily lives of people. Implementing a policy to mitigate inflation would be beneficial for the overall economic well-being.

Reference:

Mankiw, N. G. (2021).Principles of economics(9th ed.). Cengage Learning.