Honduras: inflation, recession, and economic policy

Abstract

“Stagflation” is the phenomenon of economic stagnation accompanied by inflation and unemployment. In general, economists define “stagflation” as a situation characterized by inflation and unemployment, along with a decline in the economy’s real growth rate. This is known as an economic slowdown or economic contraction. This phenomenon can lead to negative growth rates, which is what is known as an “economic recession”—that is, when the growth rate of the Gross Domestic Product (GDP) falls below “zero” for two consecutive quarters.