Revenue maximizing inflation

• 成果类型: Article
• 署名作者: Kimbrough, Kent P.
• 署名单位: Duke University
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2005.07.023
• 发表日期: 2006
• 页码: 1697-1708
• 关键词: revenue maximizing inflation; inflation tax; Seigniorage; Cagan money demand function; Cagan's rule

摘要

A classic monetary policy result is that revenue maximization entails setting the inflation tax rate equal to the inverse of the interest semi-elasticity of the demand for money. The standard approach underlying Cagan's rule is partial equilibrium in nature, treating money demand as being given from outside the model and abstracting from the real effects of inflation. This paper reconsiders the question of the revenue maximizing inflation rate in a general equilibrium framework with a laborleisure choice, where money is held because it reduces transactions costs. In this framework, the revenue maximizing inflation tax rate is lower than that implied by Cagan's rule. (c) 2006 Elsevier B.V. All rights reserved.