Gauging Capacity Pressures Within Businesses
7 Pages Posted: 9 Apr 2007
Abstract
This article discusses the measurement of capacity pressures within businesses a key influence on the outlook for inflation. The degree of pressure on capacity relative to normal is likely to affect businesses' costs and prices. A variety of different methods are presented, each with their own advantages and drawbacks. Ultimately, no measure of capacity pressure is perfect, and the policymaker's judgement is crucial.
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