SFB 303 Discussion Paper No. B - 123

Author: Klein, Martin
Title: Monetary and Fiscal Seigniorage: Theory and Evidence
Abstract: This paper is a contribution to the debate about seigniorage in Europe. The main point is a theoretical and empirical comparison of two measures of seigniorage: Monetary seigniorage, the change in the stock of base money in real terms, and fiscal seigniorage, which is defined as the actual resource transfer received by the government from the central bank. The theoretical analysis examines the short-run and long-run relationship between these two measures. The empirical analysis for Germany and Great Britain shows that there are substantial gaps between monetary and fiscal seigniorage, which can probably be traced to the institutional implementation of the money supply process.
Keywords: Seigniorage, European Community, Monetary Policy
JEL-Classification-Number: No. 311
Creation-Date: March 1989
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