Working Paper
Welfare costs of inflation: the case for interest-bearing money and empirical estimates for Brazil
Fecha
1994-07Autor
Simonsen, Mario Henrique
Cysne, Rubens Penha
Institución
Resumen
We provide in this paper a closed fonn for the Welfare Cost of Inflation which we prove to be closer than Bailey's expression to the correct solution of the corresponding non-separable differential equation. Next. we extend this approach to ao economy with interest-bearing money, once again presenting a better appoximation than the one given by Bailey's approach. Fmally, empirical estimates for Brazil are presented.