Within the space of a year, we’ve gone from worrying about the imminent death of elderly loved ones and the potential for skyrocketing joblessness to worrying about the spectre of rising prices. | OPINION by Jess_Irvine
There is an emerging concept in psychology known as “subjective wellbeing homeostasis”.
More recently in the field of psychology, it has been argued, perhaps most notably by Australian psychology professor Robert Cummins, there also exist mental processes which regulate a person’s sense of their own wellbeing. “The stability of subjective wellbeing at the level of population sample mean scores is remarkable,” Cummins observes. “Actually, it is extraordinary!”Which may help to explain, I think, the remarkable resilience Australians have – in aggregate – shown to the pandemic.
In the US, JP Morgan CEO Jamie Dimon is urging investors to “brace yourself” for an economic “hurricane” as the US Federal Reserve flirts with tipping the world’s largest economy into recession to stop high inflation. And anyway, some interest rate increases – including this Tuesday’s near-certain hike – are not a portent of doom.
It’s true that mandate has found expression in recent times in a commitment to keep consumer prices rising between 2 and 3 per cent over time. But price stability is not the end point in itself, but merely an important means to the end of achieving a well-functioning and fully employed society.
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