This suggests that the optimal rate of inflation depends on the balance between the effects of the grease and the sand.

ECONOMIST: Central banks disagree on the rate of inflation to aim for

There are a number of good reasons to think the optimal long-run inflation rate is close to zero.

FORBES: Monetary Easing Has (Almost) Nothing To Do With Deceiving Consumers

Mr Wyplosz concludes that low rates of inflation carry a significant unemployment cost, and that the optimal rate may be higher in Europe than it is in America.

ECONOMIST: Central banks disagree on the rate of inflation to aim for