deflationary gap


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Related to deflationary gap: Inflationary gap

deflationary gap

n
(Economics) economics a situation in which total spending in an economy is insufficient to buy all the output that can be produced with full employment
References in periodicals archive ?
This sum constitutes the leakage or deflationary gap because this is the amount of money that comes into the banking system but cannot leave the system because there are no more borrowers left.
With the advanced economies struggling to get out of the slump, "the world economy is now facing a widening deflationary gap created by deficient global demand", it said.
From the macroeconomic perspective, the sum of household savings and net corporate debt repayment, which is the money that is entering the banking system but is not coming out to re-enter the income stream due to the lack of borrowers, constitutes the deflationary gap of the economy.