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Money is nominal, productivity is real. You can't pay beyond productivity gains, broadly across society, without inflation.
by adam_arthur 4y ago
Money is nominal, productivity is real.
You can't pay beyond productivity gains, broadly across society, without inflation.
- deleted 4y ago[deleted]
- AlexandrB 4y agoBy that logic workers are due for a huge pay bump[1] without triggering inflation. [1] https://www.epi.org/productivity-pay-gap/ https://www.epi.org/productivity-pay-gap/
- adam_arthur 4y agoIt doesn't work that way. Nominal pay increases now will be inflationary from current level of prices. History of wage/productivity isn't relevant to current price/wage dynamics. Just forward rates. Those past productivity gains were likely captured in lower cost of goods (in real terms), rather than wages. If margins are constant, and wages don't rise, and productivity gains, then cost of goods are lower, which also benefits society.
- everybodyknows 4y agoSure you can, to some extent, given more effective progressive taxation. Starting with a "mansion tax", luxury car tax, cryptocurrency tax, ...
- adam_arthur 4y agoInflation is driven by consumption, the bulk of which is done by the lower/middle class. Inflation in construction/housing is an area likely driven by upper class