Nearly two thirds of the population think that if inflation is halved, the price of goods will go down

[MereDintofPandiculation]

AIBU to think this means that we need to get a lot better at teaching maths?

Source: Survation poll quoted in Guardian

I think if companies can get away with charging higher prices and making more profit, they aren't going to give that up!

This is scary but predictable.

I'm not surprised

I don't think it's necessarily poor maths. Many people just do not understand the basics of economics.

People do not understand that inflation is the increase in prices. Halving inflation just means that the rate of increase slows. It does not mean that prices decrease.

So people think inflation means “amount prices have gone up” rather than “rate at which prices are increasing”?

I am not sure maths covers the meaning of words like inflation does it? Or any economics terms really.

This. They just need to know the difference between inflation and deflation, and that low inflation is not deflation.

Indeed, and prices will continue to rise largely unabated.

This

I’m not sure why it’s assumed people would understand economics. It’s one reason Martin Lewis is so good at what he does

Ah yes. Similar to when the CEO of the organisation I work for told us we couldn’t have payrises in-line with inflation because inflation would come back down soon…

and everyone around me lapped that up.

Actually it is poor maths, @Seeline

When you assess the understanding of STEM university students of the theory of functions and their gradients, which is exactly what this is, even those who can execute applications competently frequently get tripped up. (Inflation is the gradient of price)

I'm not surprised either - the BBC do it all the time "Inflation has decreased from 10% to 5%" says one reporter. Other reporter "so when will we see prices decreasing in line?"

Well obviously they won't, they just won't be going up as quickly. SO many people just don't understand the very very basics like this or supply/demand.

I don’t think it’s a misunderstanding of economics. I think it’s poor maths skills and reading comprehension.

If something is inflating more slowly, it doesn’t mean it’s stopped inflating or is deflating. If was getting fatter at a slower rate than last week, I’m not suddenly thinner or losing weight, I’m still gaining weight at a slower pace.

I don’t think you need a qualification in economics to understand this.

Yes I think it is a tricky concept to understand so should be taught at gcse

Isn’t maths the basics of economics?

This is a misunderstanding of a second derivative in mathematical terms, or in layman’s terms, a decrease in acceleration or a decrease in gradient. The car is still increasing speed but not as rapidly as before. You’re still going uphill, but it’s not as steep as it was.

People are stupid, badly educated and incurious, just how the government want them. It doesn't suprise me at all that people don't understand the causes and results of inflation.

It’s truly scary. I only did maths to GCSE level but I manage to wrap my head around it…. We need to invest in education and agree with PP that BBC et al need to be clearer with reporting

I’m not sure why it’s assumed people would understand economics. It’s one reason Martin Lewis is so good at what he does If you understand maths, you don’t need to understand economics to understand inflation

This is a misunderstanding of a second derivative in mathematical terms, or in layman’s terms, a decrease in acceleration or a decrease in gradient. The car is still increasing speed but not as rapidly as before. You’re still going uphill, but it’s not as steep as it was.

Look, my maths is awful. I wouldn't know a second derivative if it came up in my soup. But this isn't even that - it's basic numeracy and percentages.

Something costs £100. Inflation is 10% a year. At the end of the year, item will cost £110. End of that year, the inflation rate is 5%. On what planet can anyone imagine that the item won't therefore cost £115.50 at the end of year 2? OK, if inflation hadn't gone down at the end of year 1 it would have been another 10% more expensive and £121 rather than £115.50. But it doesn't ever get cheaper!

A lot of people struggle with what rates of change mean. They do cover distance, speed and acceleration at GCSE (at least at the higher tiers) which is the same concept, but I think a lot of pupils don't understand it well, and also I suspect a lot of people wouldn't be able to relate that information to inflation.

the BBC do it all the time "Inflation has decreased from 10% to 5%" says one reporter. Other reporter "so when will we see prices decreasing in line?"

I think it is poor media reporting confusing people - though I don't know anyone expecting price to deceases most just want price increases to slow or ideally stagnate.

The fixed rate gas reporting also seemed to cause MIL and her mates confusion - the rate per unit was fixed so if they used much more than usual they'd pay more but at that fixed rate - so they were better off than most but were talking about expanding energy usage because it was fixed price and they didn't have to worry about bills.

Well I will admit to being clueless. But if inflation slows, prices stop going up right? Assuming that they are directly linked. So the price of a pint of milk holding steady might feel cheaper, or at least less scary, especially if you've had a pay rise. And some things might become cheaper because the costs of production and transportation is no longer inflated? And shops may pass that on to get shoppers in the door?

Anyway, the fact that people don't know this is because they weren't taught it. Well, I wasn't or if I was I don't remember! It doesn't mean the public is stupid of incapable of understanding, just that it's something some people don't understand until it is explained

Maybe Rishi Sunak's maths to 18 plan isn't such a bad idea.

Not a surprising result from the survey, but the point about maths and financial education is well made.

But this is so basic. Inflation is how much prices have risen. If inflation is low then they've just risen a bit less, they haven't gone down. It doesn't require any more knowledge than that.