In a way, one may even conclude that it should not try to bring down inflation dispersion beyond a certain level. “Breathing” of relative prices is an essential element of the equilibrating and adjustment mechanism and in that sense a crucial feature of the functioning of market economies.
At the start of the 1970s, the Report of the Club of Rome, which centred on the predicted depletion of natural resources, raised alarm about the survival of the earth’s ecosystem and of the human race. These projections received great attention from the media, but they were greeted sceptically by many eminent economists of the time.