Is it true that inflation always goes with economic growth?

I am a little worried that I am not asking a right question because economic growth may not necessarily has any causal relationship with inflation at all. Therefore, I feel someone may pick the way I am asking the association of inflation and the economic growth.

The reason I get this question in my mind for a long time is that I find cases that very rapid economic growth actually leads to inflation in certain extend. For example, most people living in China will feel their money is not as useful as before; that is, the price for general goods increase quite quickly, particularly from year 2006 -- this is a personal feeling. During this period, China experience a super fast economic growth, at least in terms of GDP growth.  Therefore, I hope to know the reason for the inflation during this period -- is it due to the economic growth?

If I search online about inflation and economic growth, there are many items related. However, it seems not all the explanations are consistent. Someone says the inflation is due to the mass money printing of Chinese government; someone says that it is because the increased demand of goods of Chinese people, which is stimulated by the rapid economic growth, makes the price higher; also, there is an explanation on the increased labor cost which makes the price of goods higher. I guess there may be more explanations.

I really hope to get a clear answer from someone about my confusion. However, based on my current understanding, if I need to give a reason for the inflation after/with economic rapid growth is that:

1. economic growth -->
2. positive monetary policy leads a rapid growth M2, mostly due to the increased loans of firms --> firms with new money borrowed will expand their business -->
3. general wages of labor increases due to the demand of labor and also due to the increased value created per labor -->
4. with increase wage level or expectation of increase wages/job demand, people will increase their consumption -->
5. on one hand 4. will again stimulate another round of economic growth -->
6. After several cycles from 1 to 5, several things will happen:
    i. the cost of borrowing more money increases which may be due to the tight monetary policy of the government; or due to the limited liquidity a firm can borrow; or the risk of a firm increases.
    ii. with increased wages and the increased cost of capital and the increased real interest rate, the price of goods increases.

ii. is the inflation we see with economic growth.
i. can be a reason an economy goes from rapid growth to a bad decay.

This is what I can think about at this moment to explain the inflation with economic growth that I have seen.

One thing I need to mention is that inflation should be caused by the increased supply of money, but I feel the increased supply of money is not the fundamental cause, but a reaction of government and commercial firms due to the stimulated human desire. So the simulated human desire or an irrational anticipation for future based on current good economic situation should be the root cause of inflation after economic growth.

Anyway, I think I may have a new understanding on this issue after another while of study and experience.


Here are some of references I get my thought from:
1. http://everydayecon.wordpress.com/2007/07/20/inflation-and-economic-growth/
2. http://www.cato.org/sites/cato.org/files/serials/files/policy-report/1999/11/cpr-21n6.html
3. http://www.21cbh.com/HTML/2012-9-3/2NMTI1XzUxMjc2NA.html