Government Revenue from Financial Repression
Unifortune Asset Management SGR SpA
Martha De Melo
World Bank - Development Research Group (DECRG); National Bureau of Economic Research (NBER)
NBER Working Paper No. w3604
This paper presents an analysis of the theoretical underpinnings and the relevance of the phenomenon of financial repression from a public-finance perspective. The analysis explicitly accounts for the interaction between capital controls and financial repression. The proposed empirical estimate of the revenue from financial repression is based on the difference between the domestic and the foreign cost of borrowing of the government. The correlations of the revenue from financial repression with inflation, exchange rates and per-capita income are discussed.
Number of Pages in PDF File: 49working papers series
Date posted: May 3, 2004
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