Expenditure rises to meet income.
Parkinson's second law, and the personal version of the same mechanism. It is why lifestyle inflation absorbs raises and why departmental budgets are spent down before year end.
In practice
- A department that receives a 6% budget increase finds 6% more essential expenditure by the second quarter.
- A household that gets a raise reports the same monthly pressure within a year, and could not say what changed.
- Subject
- Economics & Incentives
- Essay
- The regularities money obeys