ABSTRACT

In a sense, the second sector produces only “fake money”. The presence within the domestic economy of the second sector also creates the conditions for unemployment. This chapter observes effortlessly an important fact: inflation originates from the second sector and it affects only the first sector. A malady of money, inflation hits the product as well; if the product of each period were deposited in money, until the final expenditures of income, inflation would always be strictly nil. Fixed capital being placed in the continuum, the chapter determines the maximum amount of dual production and therefore of inflation in proportion to the domestic product in each period. When inflation results, “dynamically”, in the continuous increase of the price of wage-goods over time, the theorist is made aware of an important truth: the share of wage-earners is decreasing. However, the relative increase in the price of wage-goods is a meaningful index even in quantum analysis.