Andrew Sentance Wants Us to Stop Worrying About Deflation

Andrew Sentance, a former member of Bank of England's Monetary Policy Committee, wrote in the Financial Times that we should stop worrying about deflation. He actually is at least partly right.

Sentance distinguishes between what he calls "chronic" deflation, "benign" deflation, and "price adjustment." He says that we need only worry about the former, a process whereby price declines become self-perpetuating, much as an inflationary spiral can become self-perpetuating. He writes that in this...