Inflation & idle cash
Inflation is your economy's temperature: deficit spending and overheating growth push it up, and even idle cash you hoard can spill into prices. Above 4% it starts dragging on growth.
How it works
Each quarter the sim computes an inflation target and eases toward it (lerp at 0.4). The target is a 2% baseline plus 'deficit pressure' (last quarter's deficit as a share of GDP, ×24 — or a small −0.3 relief when you run a surplus) plus 'heat' from any growth above 4%. The whole target is clamped between −1% and 14%.
There's a subtle trap with idle money. If your treasury balloons past 65% of GDP, the sim treats it as obvious over-hoarding and injects a slice back into the economy: it moves up to 10% of the excess (capped at 1% of GDP) out of the treasury, converts 60% of it into GDP, and bumps inflation. Hoarding is wasteful; deploying it grows you but risks overheating.
Inflation bites back on growth: any inflation above 4% subtracts from the efficiency multiplier (−(inflation − 4) × 0.03). So letting prices run doesn't just look bad on the dashboard — it quietly caps how fast you can grow.
Formulas
deficitPressure = lastDeficit > 0 ? (lastDeficit / GDP × 24) : −0.3heat = max(0, gdpGrowth − 4) × 0.3infTarget = clamp(2 + deficitPressure + heat, −1, 14)inflation = lerp(inflation, infTarget, 0.4)inj = min((treasury − GDP×0.65) × 0.10, GDP × 0.010); GDP += inj × 0.6; inflation += (inj/GDP) × 10Key numbers
How to play
- ▸Persistent deficits are the main inflation driver (×24 transmission) — a balanced or slightly surplus budget keeps prices near the 2% baseline.
- ▸Keep inflation under 4%: above that it directly saps your growth efficiency, compounding the damage.
- ▸Don't stockpile treasury past ~65% of GDP; the auto-injection deploys it for you at a fiscal multiplier of 0.6 but heats prices. Spend deliberately on projects or debt paydown instead.
- ▸If growth is running hot (above 4%/q), expect an inflation bump — plan for a cool-down rather than pushing stimulus on top.