financial theory holds that equity should be a good inflation hedge since it represents a claim of real rather than nominal …This paper examines the relationship between inflation and the return on individual corporate securities. This question … assets. Yet a negative relationship between both expected and unexpected inflation and stock market returns has been widely …

's q theory of investment. As Tobin has explained, aggregate investment can be expected to depend in a stable way on q, the … is that it is rooted in a microeconomic theory that integrates the interests of the corporation and its shareholders …

This paper considers the problem of optimal long run monetary policy. It shows that optimal inflation policy involves … trading off two quite different considerations. First, increases in the rate of inflation tax the holding of many balances … of inflation raise capital intensity. As long as the economy has a capital stock short of the golden rule level …

It is often argued that the most important costs of inflation can be substantially mitigated by indexing reforms. Yet … governments in moderate inflation countries have generally been very reluctant to promote institutional changes that would reduce … the costs of inflation. Capital income continues to be taxed on a nominal basis, indexed bonds are a rarity, typical …