How does inflation affect real wages in relation to exports?

Inflation refers to the general increase in prices over time, which means that the money people earn buys less than it used to. When inflation rises, real wages, which are the wages adjusted for inflation, often decrease because workers cannot afford as much with their earnings. For example, if someone earns $50,000 a year but inflation causes prices to rise, that $50,000 might only feel like $45,000 in purchasing power. This can affect exports because if local workers earn less in real terms, they may not be able to produce goods as competitively, leading to higher prices for those goods abroad. Thus, inflation can create a cycle where lower real wages make exports less appealing to foreign buyers.