Conducting policy of creating demand by increasing public debt, therefore, lies in the threat occurrence of inflation, unless the policy ceased quite early, before reaching full employment and capacity utilization. In the case of continuing this process to achieve full utilization of capacity, there is the state of inflation caused by excess demand over possible to produce the production. This type of inflation is called demand inflation. It appears in fact, in periods of overheating, and its cause may be, in addition to excessive spending, excessive investment expansion. That is the problem-in theory. In fact, it is more complicated.
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