what happened to the economy during the last period of disinflation 
academic research shows that the economy suffered two recessions and higher unemployment during the last sustained period of disinflation in the early 1980s the bottom linedisinflation refers to a slowing in the rate of inflation typically when it eases over the short term proponents of disinflation argue that it s necessary to prevent the economy from overheating while opponents say that it can lead to a downturn or cause deflation as it represents economic contraction disinflation typically arises from a reduction in the money supply that results from rising interest rates but it can also come about by productivity advancements or companies raising prices at a slower pace during a contracting business cycle a period of disinflation in the early 1980s indicates the economy may contract over the next few years if history repeats 