Final answer:
In the context of the classical dichotomy, the condition where 'the wages workers earn continuously lose value due to inflation' is not considered a social cost of inflation, as the dichotomy assumes that nominal wages would adjust with inflation.
Step-by-step explanation:
According to the classical dichotomy, the term that is not a social cost of inflation is that the wages workers earn continuously lose value due to inflation. The classical dichotomy refers to the separation of real and nominal variables. In theory, nominal wage increases would keep up with inflation, maintaining the purchasing power of workers, hence this is not considered a social cost in this context.
Inflation can cause a range of social costs, including the need for firms to adjust their prices frequently (known as menu costs), the need for individuals to minimize holding too much cash due to its diminishing buying power, and the distortion of the relative prices of goods which can lead to unclear price signals. These issues can lead to difficulties in long-term planning, unintended redistributions of purchasing power, and blurred price signals.