MONEY HOLDINGS, INFLATION, AND WELFARE IN A COMPETITIVE MARKET*

a study on rate making and required reserves determination in reinsurance market: a simulation

reinsurance is widely recognized as an important instrument in the capital management of an insurance company as well as its risk management tool. this thesis is intended to determine premium rates for different types of reinsurance policies. also, given the fact that the reinsurance coverage of every company depends upon its reserves, so different types of reserves and the method of their calc...

U.S. Money Demand and the Welfare Cost of Inflation in a Currency–Deposit Model

This paper emphasizes that it is crucial to identify the proper specification of money demand as well as the appropriate monetary aggregate to find the exact welfare cost of inflation. The econometric test results obtained from the nonlinear form of money demand with Box–Cox restriction indicate that not the semi-logarithmic form but the double-log form with constant elasticity of less than one...

The Welfare Cost inflation in Iran

The purpose of this paper is to estimate the welfare cost of inflation in Iran. We first use the long-horizon regression approach developed by Fisher and Seater (1993) to obtain an estimate of the inflation rate elasticity of money demand and then the Baily’s consumer surplus approach to calculate the welfare cost function. The results show that reducing inflation rate from 40% to 0% increases ...

Optimal monetary policy with heterogeneous money holdings

We study the optimal anticipated policy in a pure-currency economy with flexible prices and a nondegenerate distribution of money holdings. The economy features a business cycle and lump-sum monetary injections have distributional effects that depend on the state of the cycle. We parsimoniously characterize the dynamics of the economy and study the optimal regulation of the money supply as a fu...

Money and Inflation