DOGE is issued in limited quantities over a finite time, and in unlimited quantities over an infinite time, which is both an advantage and a disadvantage. Dogecoin has inflation, while Bitcoin has deflation.
Currently, and for the next hundred years or so, Dogecoin operates similarly to most other crypto assets and will continue to do so. The "capped" assets are far from fully mined - and will continue to increase their supply for the foreseeable future, just like Dogecoin.
The supply of Dogecoin is not infinite because its issuance per block, per day, and per year has absolute limits - just like other currencies. The only difference is that Dogecoin's issuance does not have an end date. Therefore, Dogecoin is only "infinite" in "infinite time". In finite time, its issuance is actually limited.
Issuing once a year is to pay miner fees and ensure network security. Other blockchains, like Bitcoin, will theoretically stop annual issuance completely by 2140, at which point they need to find a way to secure their network (if it still exists), otherwise their consensus mechanism's design will need a complete overhaul. In short, setting a cap on Dogecoin would make the network insecure and vulnerable to attacks.
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