A pay rise that loses to inflation can still feel like a win
People instinctively think in the face value of money rather than what it can actually buy, so a 3% raise during 5% inflation — a real pay cut — often still feels like good news, while a pay freeze during zero inflation feels like a loss, even though the buying power is identical. Irving Fisher named this 'money illusion' in 1928, and it still shapes how workers react to wage and price changes.