This is a good article. However, I would like to make a small defense of the people. As best as we can tell, price changes for goods follow something like state-dependent pricing, where firms pay some cost to change prices. Thus, when we have higher inflation, the absolute size of price changes doesn't change -- instead, we get more of them. However, wage contracts exhibit elements of both time-dependent and state-dependent pricing. When there's an increase in inflation, you get a very lumpy and uneven adjustment process. If we say that people are risk averse due to consumption commitments like a house and car, then we can get very large decreases in utility.

I wrote about this earlier on my blog. nicholasdecker.substack…