The Behavioral-Structural Theory of Inflation: Consumer Willpower as a Damping Force. A Proposed Theoretical Framework and Mathematical Model

This paper presents a novel theoretical framework for analyzing inflation dynamics through the integration of behavioral and structural factors. We introduce the concept of "Consumer Willpower" (C) as a key mediating variable that influences actual demand elasticity and limits firms' ability to pass through cost shocks. The theory is based on a mathematical model that integrates market structure (N), goods substitutability (θ), and dynamic pricing mechanisms. Results indicate that economies with higher consumer willpower exhibit lower inflationary elasticity, opening new horizons for non-monetary anti-inflation policies. The theoretical framework was applied to a comparative study between the Japanese economy (deflationary) and inflationary economies (such as Egypt), confirming the theory's comprehensiveness and applicability across different economic contexts.