Inflation and Real Growth
The post titled “Money” shows the GNP or money=k*(employed)^4 and volume=k*(employed)^2.16 and
price=k*(employed)^1.84. In the context of these posts the number of dimensions of the production
facilities, m=2.16 and the price exponent is (4-m). Differenting by parts results is the fraction of the change
in GNP that is real growth is m/4 and the part that is inflation is (4-m)/4. The value of m therefore determines
the fraction that is inflation and real growth. The value of m determine the fraction that is real growth, namely;
m=1 results in 25% real growth,
m=2 results in 50% real growth
m=3 results in 75% real growth.
Obama’s and others “put people to work” with bail-out government money will not help the economy much if
the number of dimensions of those activities is low (e.g. a shovel in hand ditch digger) vs. high
(like building a petrochemical plant).