Advanced Search
MyIDEAS: Login

Virtual Deficits and the Patinkin Effect

Contents:

Author Info

  • Eliana Cardoso

    (International Monetary Fund)

Abstract

The paper develops a model of inflationary finance that defines the fiscal deficit as a function of the virtual deficit--one that would be observed at zero inflation. It studies the negative relationship between the inflation rate and real government expenditures--the Patinkin effect--a powerful stabilizer during megainflation. The model outperforms other seigniorage models in explaining the persistence of four-digit inflation rates that never explode into an open hyperinflation. It also explains how apparently expansionist fiscal policies end in measured real deficits that are small and compatible with the small amount of seigniorage that can be collected at high inflation rates.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.jstor.org/stable/3867587?origin=pubexport
File Function: main text
Download Restriction: Access to full text is restricted to subscribers.

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Bibliographic Info

Article provided by Palgrave Macmillan in its journal Staff Papers - International Monetary Fund.

Volume (Year): 45 (1998)
Issue (Month): 4 (December)
Pages: 619-646

as in new window
Handle: RePEc:pal:imfstp:v:45:y:1998:i:4:p:619-646

Contact details of provider:
Web page: http://www.palgrave-journals.com/

Order Information:
Postal: Palgrave Macmillan Journals, Subscription Department, Houndmills, Basingstoke, Hampshire RG21 6XS, UK
Email:
Web: http://www.palgrave-journals.com/pal/subscribe/index.html

Related research

Keywords:

Find related papers by JEL classification:

References

No references listed on IDEAS
You can help add them by filling out this form.

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. repec:idb:brikps:4198 is not listed on IDEAS
  2. Erik Hjalmarsson & Par Osterholm, 2007. "Testing for cointegration using the Johansen methodology when variables are near-integrated," International Finance Discussion Papers 915, Board of Governors of the Federal Reserve System (U.S.).
  3. Pekarski, Sergey, 2011. "Budget deficits and inflation feedback," Structural Change and Economic Dynamics, Elsevier, vol. 22(1), pages 1-11, February.
  4. Stanley Fischer & Ratna Sahay & Carlos A. Végh Gramont, 2002. "Modern Hyper- and High Inflations," IMF Working Papers 02/197, International Monetary Fund.
  5. Teles, Vladimir Kuhl & Cardoso, Eliana Anastácia, 2010. "A brief history of Brazil's growth," Textos para discussão 241, Escola de Economia de São Paulo, Getulio Vargas Foundation (Brazil).
  6. Erik Hjalmarsson & Pär Österholm, 2010. "Testing for cointegration using the Johansen methodology when variables are near-integrated: size distortions and partial remedies," Empirical Economics, Springer, vol. 39(1), pages 51-76, August.
  7. Nauro F. Campos & Armando Castellar Pinheiro & Fabio Giambiagi & Maurício M. Moreira, 2002. "Does it Take a Lula to go to Davos? A Brief Overview of Brazilian Reforms, 1980-2000," William Davidson Institute Working Papers Series 2003-580, William Davidson Institute at the University of Michigan.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:pal:imfstp:v:45:y:1998:i:4:p:619-646. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Elizabeth Gale).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.