Centro de Documentacion de Fundación MAPFRE - Optimal seigniorage and financial liberalization

MAP20070010571

Optimal seigniorage and financial liberalization / by Philippe Bacchetta and Ramón Caminal. — Barcelona : ESADE, 1990

23 p. : graf. ; 30 cm . — (Papers ESADE ; 41)

Sumario: This paper analyzes the effect of financial integration for countries relying on seigniorage. A two-country model with overlapping generations and explicit financial intermdiation is used. Governments derive revenues from seigniorage and set optimally, but non-cooperatively, the rate of inflation and the level of required reserves on bank deposits. A financial liberalization reduces welfare and leads to lower reserve ratios, higher inflation rates, and higher government debt. When the liberalization is anticipated, governments temporarily increase the reserve ratios before the liberalization occurs

1. Mercados financieros . 2. Gestión financiera . 3. Unión Europea . 4. Liberalización de mercados . 5. Libre circulación de capitales . I. Caminal, Ramón . II. Escuela Superior de Administración y Dirección de Empresas . III. Papers ESADE ; 41 . IV. Title.