This paper considers the existence of a path of GDP corresponding to steady inflation in the prices of domestic goods. We estimate the steady inflation rate of growth, denoted the SIRG, at a little over 4 per cent per annum in the post-float period. Changes in inflation are modelled as a...

The paper advances a simple and tractable Wicksellian model of inflation, in which the price level is determined by the interaction of the nominal rate of return on capital with a rule that governs the interest rate at which the Central Bank supplies money, and in which the equality of the...