A few thoughts, I worked in hardware and lumber in the 70's. We could not keep up with the price changes. The prices would rise between shipments. Our invoiced price often were higher than what we we selling the current stock at. Existing old inventory obviously we made a great mark up on, but that profit was eaten up by the price increase we missed. Customers were always irate. This was a time many stay at home mothers entered the work force. This was the era that ushered the mafia in, full force, because of taxes. The underground cash economy flourished.
I remember those things. Not only were prices skyrocketing, there were lots of shortages in materials: sheetrock, cement, roofing, etc. Since the definition of inflation is too much money chasing too few goods and services.......inflation could have partly been due to less production. One poster mentioned wage and price controls of the early '70s........perhaps the inflation of the mid '70s was partly a result of those restrictions being lifted. Stosh
Another cause of inflation is a nation's currency falling in value against its major trading partners.
I really don't recall any hardships from the price controls. I remember this being an issue on the news but I grew up in a union family and didn't notice any gripes from the relatives or changes in standards of living.
x2. The cost of everything went up because energy costs were such a large part of the final cost of products. I remember prices climbing like mad...every time you went to the grocery store, stuff was a few cents more. Had a friend that attended my MBA school before I did who got into an argument with a professor about whether the cost of oil was the root cause. When I took the same class, I perpetuated the argument, and his response was, "I'm evaluating that". It was, and has always been debateable, but with our recent oil shock, I'm confident that is what it is. I now believe for an unnatural thing like stagflation to exist, you must have an outside force acting on a marketplace. We started seeing it again a few months ago, IMHO. SM
i don't think by itself federal spending during the 1960s was the primary cause, because the annual deficits as a percentage of GDP were very low in the 1960s. fairly restrained spending like that must have been combined with other factors like dwindling productivity for there to have been that much inflation. table 1.3 http://www.whitehouse.gov/omb/budget/fy2009/pdf/hist.pdf