Work

Analyses of Inflation Dynamics as a Consequence of Monetary-Production Imbalance in Global Markets

Year: 2026

Type: article

Abstract: This study proposes a physically grounded theoretical framework for the description of human activity in industrial, technological, and economic domains of knowledge. We apply ab initio principles to model human work in the environment as a thermodynamical process in which technological and industrial outcomes are equivalently mapped to mass/energy manipulation driven by the available information charge. In this paradigm, economic value is decomposed into material and informational components. Price formation emerges as a byproduct of these dynamics, arising from nonlinear interactions between supply and demand. By corollary, economic inflation, which is classically interpreted as a monetary phenomenon arising from the interaction between the money supply and aggregate demand, is shown to be generated by a simple and intuitive mechanism. A new class of monetary indices is then defined, comprising four inflation moments suitable for describing the inflationary phenomenon. We analyze the historical evolution of moments and inflation in several countries. Some discussion about sustainability and technological advances is also performed.

Source: Computational Economics

DOI: 10.1007/s10614-026-11472-y

Authors: Adnei Marinho, Herson Rocha

Institutions: Universidade Federal Rural da Amazônia, Universidade Federal do Rio de Janeiro

Language: English

Topic: Monetary Policy and Economic Impact

Subfield: General Economics, Econometrics and Finance

Field: Economics, Econometrics and Finance

Domain: Social Sciences

Open Access status: hybrid

Estimated APC paid: $3,290

Funders: Universidade Federal Rural da Amazônia, Universidade Federal do Rio de Janeiro