Literature Review and Commentary on the Relationship between Inflation and Residents’ Consumption Behavior

Abstract

As a core indicator of macroeconomic operation, inflation’s significance lies in the fact that it directly determines the stable foundation of the macro economy and the baseline of ordinary people’s quality of life. Given that its fluctuations are closely tied to both the national economy and individual livelihoods, inflation has not only become a key focus for in-depth academic research but also a core issue that policymakers must prioritize when formulating regulatory strategies. Given that many researchers have conducted in-depth studies on inflation-related issues, this paper, based on existing literature, classifies, summarizes, and comments on inflation-related research from three aspects: first, the influencing factors of inflation formation; second, the impact of inflation on consumption behavior; third, the heterogeneous effects of inflation. The study finds that expected inflation is affected by inflation information, and actual inflation is in turn affected by expected inflation; the impact of inflation on consumption is mainly reflected in total consumption volume, consumption methods, and consumption structure; and the impact effects vary according to the characteristics of different population groups.