The recent inflation surge prompted renewed assessments of inflation inequality. Examinations of inflation by income or other demographic groups point to a shrinking or stable inflation gap between high- and low-income households in 2022. At the same time, research using scanner data shows grocery inflation becoming much more disparate with rising inflation. I show that aggregating households into demographic groups not only masks the majority of heterogeneity, but fails to capture important dynamics between that heterogeneity and the level of inflation.
Kelsey O'Flaherty (Fri,) studied this question.