COVID-19 Inflation Disruptions and Supply Shock: Insights from Lazard and the Brookings Institution

Lazard Chief Executive Officer Peter Orszag, Vice President William E. Murdock III and Robin Brooks, Senior Fellow at the Brookings Institution, authored a three-part blog series on the inflation surge following the COVID-19 pandemic, its supply-linked factors, and potential for more disinflation ahead as companies continue to adjust their pricing behavior after the unprecedented supply shock.

In 2022, the average rate of inflation hit 8%, marking the highest rate since the early 1980s, following over two decades of low and stable inflation. This spike raised questions about whether pandemic-era stimulus was excessive, leading to an overheated economy. The three-part series used new data to disentangle supply versus demand in the COVID-19 inflation shock and outlined expectations for inflation to continue decreasing as margins continue to normalize.

The original blog posts in the series were published by the Brookings Institution. Read the full analysis and insights below.

1. US disinflation and the COVID-19 supply shock
2. The lagged effects of COVID-19 supply chain disruptions on inflation
3. COVID-19 inflation was a supply shock