{"id":419,"date":"2024-05-16T12:48:00","date_gmt":"2024-05-16T12:48:00","guid":{"rendered":"https:\/\/tomfarandasfolly.com\/?p=419"},"modified":"2025-09-29T01:25:52","modified_gmt":"2025-09-29T01:25:52","slug":"perplexity-ai-answers-the-question-how-has-inflation-affected-different-income-groups","status":"publish","type":"post","link":"https:\/\/tomfarandasfolly.com\/?p=419","title":{"rendered":"Perplexity ai answers the question: &#8220;How has inflation affected different income groups?&#8221;"},"content":{"rendered":"<p>This is a follow up to this posting from yesterday. <a href=\"https:\/\/tomfaranda.typepad.com\/folly\/2024\/05\/perplexity-ai-answers-the-question-does-rising-inflation-lower-unemployment.html\">Perplexity ai answers the question: &quot;Does rising inflation lower unemployment?&quot;<\/a><\/p>\n<p>And the answer is (using perplexity ai pro version):<\/p>\n<p><span class=\"\">Inflation has affected different income groups in the following ways:<\/span><\/p>\n<ul class=\"list-disc pl-8\">\n<li><span class=\"\">Low-income households spend a larger fraction of their budget on necessities like gasoline, heating, food, and rent. When prices for these goods rise faster than overall inflation, it disproportionately hurts lower-income families who have less ability to absorb the shock<\/span><\/li>\n<li><span class=\"\"><span class=\"whitespace-nowrap\">.<\/span><\/span><\/li>\n<li><span class=\"\">In January 2022, for the lowest 40% of income earners, expenditure on essential categories like energy, transportation, shelter and food accounted for approximately 84% of after-tax income versus only 32% for the highest income quintile. This leaves lower income groups little room to adjust spending to avoid rising prices<\/span><\/li>\n<li><span class=\"\"><span class=\"whitespace-nowrap\">.<\/span><\/span><\/li>\n<li><span class=\"\">As of June 2023, 85.7% of individuals in households earning less than $50,000 reported being significantly stressed by inflation, compared to 60.2% for those earning over $100,000 &#8211; a 25.5 percentage point difference<\/span><\/li>\n<li><span class=\"\"><span class=\"whitespace-nowrap\">.<\/span><\/span><\/li>\n<li><span class=\"\">To cope with inflation, low- and moderate-income households have more frequently cut back on necessities like nutritious food and medical treatment, taken on debt, and worked additional hours compared to higher income groups<\/span><\/li>\n<li><span class=\"\"><span class=\"whitespace-nowrap\">.<\/span><\/span><\/li>\n<li><span class=\"\">Inflation can erode the real value of savings and fixed incomes, hurting retirees and those with limited ability to increase their earnings<\/span><span class=\"\"><span class=\"whitespace-nowrap\">.<\/span> However, it can also reduce the real value of existing debts, benefiting borrowers<\/span><\/li>\n<\/ul>\n<div class=\"relative default font-sans text-base text-textMain dark:text-textMainDark selection:bg-super\/50 selection:text-textMain dark:selection:bg-superDuper\/10 dark:selection:text-superDark\">\n<div class=\"min-w-0 break-words [word-break:break-word]\">\n<div dir=\"auto\">\n<div>\n<div class=\"prose dark:prose-invert inline leading-normal break-words min-w-0 [word-break:break-word]\"><span class=\"\">In summary, inflation tends to have a more acute impact on lower-income groups who spend a larger share of their budget on essentials and have fewer options to adjust their spending or increase their income in response to rising prices.<\/span><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"mt-sm flex items-center justify-between\">\n<div class=\"-ml-sm flex items-center gap-xs\">&#0160;<\/div>\n<\/div>\n<div class=\"mt-lg border-t pt-lg animate-in fade-in duration-1000 ease-out border-borderMain\/50 ring-borderMain\/50 divide-borderMain\/50 dark:divide-borderMainDark\/50  dark:ring-borderMainDark\/50 dark:border-borderMainDark\/50 bg-transparent\">\n<div class=\"border-borderMain\/50 ring-borderMain\/50 divide-borderMain\/50 dark:divide-borderMainDark\/50  dark:ring-borderMainDark\/50 dark:border-borderMainDark\/50 bg-transparent\">\n<div class=\"flex items-center justify-between border-borderMain\/50 ring-borderMain\/50 divide-borderMain\/50 dark:divide-borderMainDark\/50  dark:ring-borderMainDark\/50 dark:border-borderMainDark\/50 bg-background dark:bg-backgroundDark\">\n<div class=\"mb-sm flex w-full items-center justify-between\">\n<div class=\"\">\n<div class=\"flex items-center space-x-sm \">\n<div class=\"default font-display text-lg font-medium text-textMain dark:text-textMainDark selection:bg-super\/50 selection:text-textMain dark:selection:bg-superDuper\/10 dark:selection:text-superDark\">\n<div class=\"w-[24px]\">&#0160;<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"flex items-center justify-between border-borderMain\/50 ring-borderMain\/50 divide-borderMain\/50 dark:divide-borderMainDark\/50  dark:ring-borderMainDark\/50 dark:border-borderMainDark\/50 bg-background dark:bg-backgroundDark\">\n<div class=\"mb-sm flex w-full items-center justify-between\">\n<div class=\"\">\n<div class=\"flex items-center space-x-sm \">\n<div class=\"default font-display text-lg font-medium text-textMain dark:text-textMainDark selection:bg-super\/50 selection:text-textMain dark:selection:bg-superDuper\/10 dark:selection:text-superDark\"><strong>Related<\/strong><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"divide-y border-t border-borderMain\/50 ring-borderMain\/50 divide-borderMain\/50 dark:divide-borderMainDark\/50  dark:ring-borderMainDark\/50 dark:border-borderMainDark\/50 bg-transparent\">\n<div class=\"group flex cursor-pointer items-center justify-between py-sm\">\n<div class=\"transition-all duration-300  md:group-hover:text-super md:dark:group-hover:text-superDark default font-sans text-base font-medium text-textMain dark:text-textMainDark selection:bg-super\/50 selection:text-textMain dark:selection:bg-superDuper\/10 dark:selection:text-superDark\">how does inflation affect the purchasing power of different income groups<\/div>\n<div class=\"ml-sm flex-none transition-all duration-300 super font-sans text-base font-medium text-super dark:text-superDark selection:bg-super\/50 selection:text-textMain dark:selection:bg-superDuper\/10 dark:selection:text-superDark\">&#0160;<\/div>\n<\/div>\n<\/div>\n<div class=\"group flex cursor-pointer items-center justify-between py-sm\">\n<div class=\"transition-all duration-300  md:group-hover:text-super md:dark:group-hover:text-superDark default font-sans text-base font-medium text-textMain dark:text-textMainDark selection:bg-super\/50 selection:text-textMain dark:selection:bg-superDuper\/10 dark:selection:text-superDark\">what are some strategies that low-income households use to cope with inflation<\/div>\n<div class=\"ml-sm flex-none transition-all duration-300 super font-sans text-base font-medium text-super dark:text-superDark selection:bg-super\/50 selection:text-textMain dark:selection:bg-superDuper\/10 dark:selection:text-superDark\">&#0160;<\/div>\n<\/div>\n<div class=\"group flex cursor-pointer items-center justify-between py-sm\">\n<div class=\"transition-all duration-300  md:group-hover:text-super md:dark:group-hover:text-superDark default font-sans text-base font-medium text-textMain dark:text-textMainDark selection:bg-super\/50 selection:text-textMain dark:selection:bg-superDuper\/10 dark:selection:text-superDark\">how does inflation impact the retirement savings of different income groups<\/div>\n<div class=\"ml-sm flex-none transition-all duration-300 super font-sans text-base font-medium text-super dark:text-superDark selection:bg-super\/50 selection:text-textMain dark:selection:bg-superDuper\/10 dark:selection:text-superDark\">&#0160;<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>This is a follow up to this posting from yesterday. Perplexity ai answers the question: &quot;Does rising inflation lower unemployment?&quot; And the answer is (using perplexity ai pro version): Inflation has affected different income groups in the following ways: Low-income households spend a larger fraction of their budget on necessities like gasoline, heating, food, and [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-419","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/tomfarandasfolly.com\/index.php?rest_route=\/wp\/v2\/posts\/419","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/tomfarandasfolly.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/tomfarandasfolly.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/tomfarandasfolly.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/tomfarandasfolly.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=419"}],"version-history":[{"count":1,"href":"https:\/\/tomfarandasfolly.com\/index.php?rest_route=\/wp\/v2\/posts\/419\/revisions"}],"predecessor-version":[{"id":7157,"href":"https:\/\/tomfarandasfolly.com\/index.php?rest_route=\/wp\/v2\/posts\/419\/revisions\/7157"}],"wp:attachment":[{"href":"https:\/\/tomfarandasfolly.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=419"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/tomfarandasfolly.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=419"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/tomfarandasfolly.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=419"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}