Is that how inflation works? Cause I don’t think it is. Inflation is caused by creating more money than you’re removing from the system - having no effect on actual resources in an ideal setting. So they’re completely decoupled. You could have no growth and no inflation or no growth and tons of inflation, depending entirely on how much money is in the system (which is not the same thing as more houses or food, etc).
IANAE, so I might be wrong. My understanding is that GDP represents how much a country produced, in a year, in both services and physical goods. Assuming a normal inflation rate of a few %, if a country produced just as much this year as it did last year, it should see a GDP increase as the number value of those goods and services has increased due to inflation. Hence, infinite GDP growth.
I think you’re right, I just think you’re tying together two concepts under an a assumption of forced inflation - which again is correct because we do force it every year but I think the distinction is important. We could reduce or increase inflation at the government level because it’s inherently controlled by the government.
But maybe this isn’t as helpful of a distinction as I think it is.
Yes, I do assume forced inflation, because under our current economic system that’s a given. Zero inflation or deflation would lead to huge economic instability and no govt in their right mind (ignoring Japan) would choose not to inflate the currency routinely. It just wasn’t very relevant to my original comment.
Is that how inflation works? Cause I don’t think it is. Inflation is caused by creating more money than you’re removing from the system - having no effect on actual resources in an ideal setting. So they’re completely decoupled. You could have no growth and no inflation or no growth and tons of inflation, depending entirely on how much money is in the system (which is not the same thing as more houses or food, etc).
IANAE, so I might be wrong. My understanding is that GDP represents how much a country produced, in a year, in both services and physical goods. Assuming a normal inflation rate of a few %, if a country produced just as much this year as it did last year, it should see a GDP increase as the number value of those goods and services has increased due to inflation. Hence, infinite GDP growth.
I think you’re right, I just think you’re tying together two concepts under an a assumption of forced inflation - which again is correct because we do force it every year but I think the distinction is important. We could reduce or increase inflation at the government level because it’s inherently controlled by the government.
But maybe this isn’t as helpful of a distinction as I think it is.
Yes, I do assume forced inflation, because under our current economic system that’s a given. Zero inflation or deflation would lead to huge economic instability and no govt in their right mind (ignoring Japan) would choose not to inflate the currency routinely. It just wasn’t very relevant to my original comment.