"Tax increase" called cost-push inflation

 According to the principle of GDP three-sided equivalence (production = expenditure = income), when the production (* value-added production) price rises, the income also increases.

 


The problem is that if the goods and services we spend are imported from abroad, the "domestic income" will not increase. In fact, imports are a deduction for GDP (Gross Domestic Product).



Imports increase the income of foreign producers. This means that even if the domestic inflation rate rises due to the influence of import prices, the "income of domestic producers" will not be affected.



Of course, in ordinary countries, the income of domestic producers is also rising, so there is no problem even if import prices rise a little.

 


On the other hand, in Japan, instead of increasing income, it is "decreasing", and cost-push inflation, in which only "income of foreign producers" rises, has begun. According to the principle of GDP three-sided equivalence (production = expenditure = income), when the production (* value-added production) price rises, the income also increases.

 


The problem is that if the goods and services we spend are imported from abroad, the "domestic income" will not increase. In fact, imports are a deduction for GDP (Gross Domestic Product).



Imports increase the income of foreign producers. This means that even if the domestic inflation rate rises due to the influence of import prices, the "income of domestic producers" will not be affected.



Of course, in ordinary countries, the income of domestic producers is also rising, so there is no problem even if import prices rise a little.

 


On the other hand, in Japan, instead of increasing income, it is "decreasing", and cost-push inflation, in which only "income of foreign producers" rises, has begun.

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