Does anyone how the inflation rates stayed relatively low even with Ceausescu’s austerity policy in the 80s (besides the 20% rise in 82)? And speaking of, what happened in 1982? Weirdly enough, it only started to drastically increase in size during the fall of USSR in 1991, reaching 256%.
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How the inflation rates stay low:
1. You control the prices so you keep them low.
2. You report externally how profitable you are. They won’t come to check and no one will dare to call you out internally.
3. You stop comparing Capitalist concepts with Communist regimes. They are completely different.
What happened in 1990:
Guess what happens when you change your regime and go capitalist? Your economy goes ballistic for the first decade until everything stabilizes, as everyone freaks out.
Ceaușescu did not believe in inflation, as a concept.
Economic measurements, such as inflation or GDP, work completely different between centrally planned economies in socialist countries and the free market in capitalist ones. For example, GDP measures output in capitalism but input in socialism, mainly through the 5-year plans. Here is a paper detailing inflation in centrally planned economies: https://www.un-ilibrary.org/content/books/9789210452397s004-c003
The spike in 1982 is due to a smooth-brain dictator that can’t understand how finances work: https://en.wikipedia.org/wiki/1980s_austerity_policy_in_Romania
The spike in the 1990s is due to the shift from central planned market to free market and the unbelievably inefficient industries kept afloat during communist times due to a lack of competition. It’s been seen in almost all former communist countries and has been named shock therapy: https://en.wikipedia.org/wiki/Shock_therapy_(economics)
Simple explanation: the price is exactly what the glorious leader wants it to be.
When you die of hunger in the dark and cold and you cant find anything to buy anyhow, there is nothing to inflate.