Investor Glossary-misery indexInvestor Glossary-misery indexInvestor Glossary-misery indexInvestor Glossary-misery indexInsightful stock market charts - Click here
investor
Categories    # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Misery Index

The HTML to link to this page
 

The misery index is the unemployment rate plus the inflation rate. Reflecting its unhappy name, however, the misery index is usually only spoken of when both rates are high. Thus if the inflation rate is 7% and the unemployment rate is 8%, the misery index is 15%. The term "misery index" was coined by economist Robert Barro. The misery index is associated with the economic phenomenon known as stagflation, which combines recession with inflation. In the U.S., the misery index gained notoriety during the 1970s, when the country faced both inflation (partly because of rising oil prices) and recession. Because inflation had traditionally been associated with boom times and a high unemployment rate with recession, the twin phenomena of the misery index appeared contradictory. The inadequacy of Keynesian theory to explain stagflation and the high misery index spurred economists to look to monetary policy and supply-side economics for solutions. The misery index was mentioned less in the 1990s and early 21st century, periods of low inflation and (to a lesser extent) low unemployment.



Rate this misery index definition...

Learn about investing with the Investor Glossary Term of the Day


Click here for insightful stock market charts. Where is the market headed? The answer may surprise you. Find out
with the exclusive & Barron's recommended charts of Chart of the Day.


Popular Terms: inflation, stock split, required rate of return, 144a, option premium, VIX, class C shares, implied volatility, diluted share, average price per share, APR, risk management, deferred revenue, LIBOR, limit order, deferred tax, real GDP, ex-dividend, current ratio, annual return, minority interest, 1031 exchange, stock market close, FICO score, labor relations, per diem, retained earnings, quality assurance, ex-dividend date, FTSE, debt service coverage, liquidity ratio, 401a, command economy, dividends payable, Key Rate Duration, Zero Cost Collar, irrevocable trust, balance sheet, reverse mortgage, open position, 1035 exchange, phantom income, covered put, cancelled check, in escrow, EBITDA, wholly-owned subsidiary, margin rate


Accounting | Banking | Bonds | Brokers | Economy | Futures | Mutual Funds | Options | Real Estate | Retirement | Stocks | Taxes | Technical Analysis
Home | Term of the Day | Suggest a Term | Chart of the Day | Dogs of the Dow
©2004-2016 Investor Glossary - All rights reserved - Terms of Use