One such study, which estimates this relationship on the basis of a methodology that should make the estimates independent of country-specific events and of the sample period, finds that the correlation between inflation and the growth of money is close to 1, as suggested by theory.
The second factor is the combination of strong population growth and the structural difficulties of increasing the effective supply of residential land. Since 1989, the Australian population has increased by more than 40 per cent, or around 7 million people, one of the fastest rates of increase among the advanced economies.