Do Deflationary Gaps Self-Destruct?

Do Deflationary Gaps Self-Destruct?
Do deflationary gaps self-destruct? It is a complicated question to answer and before I can answer it I must explain exactly what a deflationary gap is and what its purpose in economics is.
A deflationary gap actually derives from an output gap and that is the difference between the actual level of activity in an economy, and the sustainable amount of activity given the capacity of the economy. An output gap is always given in a percentage form. It is possible for the output gap to be negative as well as positive and when the output gap is negative it i…