And perhaps even more importantly, it might also be the case that a more risk-averse society is naturally less inclined to support and finance innovation, to implement new processes and to apply new technologies. If this is indeed the case, it has implications for future productivity growth.
The sharp drop in commodity prices since its peaks in July, together with economic deceleration, is nevertheless helping mitigate pressures. Inflation in developing economies is also moderating, although more gradually, due to persistent wage demands, the pass-through effect of recent devaluations, and still high inflationary expectations.