Analysis of the Impact of Fiscal Austerity Policies on Inflation Rates: A Comparative Study Between Developed and Developing Countries

Abstract

This study examines the impact of financial austerity policies on inflation rates, with a comparative analysis between developed and developing countries. The research aims to understand how austerity measures affect inflation and whether these policies are effective in achieving economic stability. A sample of 150 participants from both developed and developing nations was selected to provide diverse perspectives. The findings reveal that 60% of participants believe austerity policies significantly impact inflation, with a stronger effect observed in developing countries. Additionally, 53.3% of participants expressed doubts about the effectiveness of austerity in controlling inflation, particularly in developed economies. Based on these results, the study recommends that policymakers reconsider the use of austerity as a primary tool for inflation management and adopt more flexible, context-specific approaches. The study contributes to a deeper understanding of the economic challenges posed by austerity and offers strategies to improve policy effectiveness.