Suppose a country has had a high and relatively stable inflation rate for a long time. How might this affect the costs and benefits of inflation reduction?

If inflation is usually about what people expect, the arbitrary redistribution of wealth associated with dollar-denominated debts may be small. High and continuing inflation may lead people to develop ways to lessen the costs of inflation. Indexed bonds and checking accounts or government policy to reduce tax distortions created by the tax code are examples. The costs of inflation reduction may be high if people have become accustomed to inflation. When expected inflation is high, the tradeoff between inflation and unemployment is poor and even small reductions in inflation may require large increases in unemployment. Further, a country that has experienced high inflation for a long time is likely to be skeptical of the central bank's commitment to reduce inflation.