Government Finance in a Model of Currency Substitution /

Our model is a variant of the cash-in-advance model. Goods must be purchased in the seller's currency, but currency may be traded before shopping at a cost. This cost is a measure of substitutability. The model is applied to seignorage taxation. We show that optimal money growth is positive and...

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Bibliografiske detaljer
Hovedforfatter: Liu, Lihong
Andre forfattere: Sibert, Anne
Format: Tidsskrift
Sprog:English
Udgivet: Washington, D.C. : International Monetary Fund, 1993.
Serier:IMF Working Papers; Working Paper ; No. 1993/080
Online adgang:Full text available on IMF
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100 1 |a Liu, Lihong. 
245 1 0 |a Government Finance in a Model of Currency Substitution /  |c Lihong Liu, Anne Sibert. 
264 1 |a Washington, D.C. :  |b International Monetary Fund,  |c 1993. 
300 |a 1 online resource (36 pages) 
490 1 |a IMF Working Papers 
500 |a <strong>Off-Campus Access:</strong> No User ID or Password Required 
500 |a <strong>On-Campus Access:</strong> No User ID or Password Required 
506 |a Electronic access restricted to authorized BRAC University faculty, staff and students 
520 3 |a Our model is a variant of the cash-in-advance model. Goods must be purchased in the seller's currency, but currency may be traded before shopping at a cost. This cost is a measure of substitutability. The model is applied to seignorage taxation. We show that optimal money growth is positive and increasing in substitutability if and only if first- and second-period consumption are gross substitutes. If governments act independently, money growth is suboptimally low if currencies are sufficiently substitutable and too high otherwise. 
538 |a Mode of access: Internet 
700 1 |a Sibert, Anne. 
830 0 |a IMF Working Papers; Working Paper ;  |v No. 1993/080 
856 4 0 |z Full text available on IMF  |u http://elibrary.imf.org/view/journals/001/1993/080/001.1993.issue-080-en.xml  |z IMF e-Library