01552cas a2200241 a 4500 AALejournalIMF008368 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451931280 1018-5941 BD-DhAAL BD-DhAAL De Gregorio, Jose. Welfare Costs of Inflation, Seigniorage, and Financial innovation / Jose De Gregorio. Washington, D.C. : International Monetary Fund, 1991. 1 online resource (34 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students This paper examines the welfare effects of mitigating the costs of inflation. In a simple model where money reduces transaction costs, a fall in the costs of inflation is equivalent to financial innovation. This can be caused by paying interest on deposits, indexing money, or 'dollarizing.' Results indicate that financial innovation raises welfare in low inflation economies while reducing it in high inflation economies, due to the offsetting indirect effect of higher inflation to finance the budget. Mode of access: Internet IMF Working Papers; Working Paper ; No. 1991/001 Full text available on IMF http://elibrary.imf.org/view/journals/001/1991/001/001.1991.issue-001-en.xml IMF e-Library