The inflation tax, purchasing power, the savings rate, and the public deficit[La taxe inflationniste, le pouvoir d'achat, le taux d'épargne et le déficit public]

The paper analyzes a frequently overlooked effect of inflation, referred to as the "inflation tax": the real loss of purchasing power borne by economic agents as a result of inflation that is not taken into account in the official methodology of the national accounts. This tax, a concept described by John Maynard Keynes (1919) and popularized as a form of "taxation without legislation" by Milton Friedman (1974), is not incorporated into standard public statistics. Its omission leads to an overestimation of the growth in household purchasing power, an overestimation of the saving rate, and an overestimation of interest expenditures and the public deficit when relying on unadjusted accounting data. Through numerical examples (for instance, the Livret A savings account or outstanding life-insurance assets), the analysis shows that, in periods of significant inflation, the gap between observed nominal returns and real returns adjusted for inflation represents a substantial transfer of wealth that is not reflected in the national accounts. The paper emphasizes the importance of incorporating this inflation tax for a rigorous interpretation of macroeconomic indicators and for a more accurate assessment of public debt sustainability, the real saving rate, and the evolution of household purchasing power.