government sometimes uses the inflation tax because it is the only way to balance its budget. Thus, inflation occurs, at least … two sources of revenue, a flat-rate tax on labor income and the inflation tax. The key assumption is that the tax on labor … income cannot vary over time. The government can issue debt, however. Thus, when spending is high, it can use the inflation …

, in particular by capturing the procyclic movements of monetary aggregates, inflation and interest rates. And its …

This paper investigates the welfare and output effects of inflation in a monetary economy with search frictions and … post prices. If prices can be adjusted at no cost, an increase in inflation reduces both the frequency and the intensity of … trades, as well as welfare. In the presence of menu costs, inflation can raise both the intensity and the frequency of trades …

This paper studies the long-run effects of anticipated inflation on output and welfare within a search … notions of competitive pricing. If prices are bargained over ex-post, an increase in inflation reduces buyers' search … markets clear, it is possible for a mild inflation to increase search intensities, output, velocity and welfare. The …