inflation rate, with and with- out an increase in the risk premium on equities, was then simulated with a number of model … cost was 3 percentage points less than that for corporate capital) and the manner in which inflation magnifies it (the … finance instruments would overcome this reallocation but at the expense of corporate capital. Only a reduction in inflation or …

inflation on interest rates and the allocation of real capital. The model allocates a fixed private capital stock among various … elasticities of demand with respect to the rental costs, and the elasticities of homeownership with respect to the cost of owning … versus renting. The interest rate adjusts in response to tax/inflation changes so as to maintain the aggregate demand for …