Volume 11, No. 1 (2008)
Austrian monetary inflation theory claims that changes in the money supply are disproportionately distributed throughout an economy, and as a result wealth inequality is exacerbated. This study proposes and tests a model illustrating this connection. After testing the model’s validity, this study compares monetary inflation’s effect on several measures of wealth inequality, concluding that not only is monetary inflation a significant variable, but its effect on wealth inequality is more pronounced at the extremities of an income distribution.
