Government Revenue from Financial Repression

49 Pages Posted: 3 May 2004  

Alberto Giovannini

Columbia University - Columbia Business School

Martha de Melo

World Bank - Development Research Group (DECRG); National Bureau of Economic Research (NBER)

Date Written: January 1991

Abstract

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.

Suggested Citation

Giovannini, Alberto and de Melo, Martha, Government Revenue from Financial Repression (January 1991). NBER Working Paper No. w3604. Available at SSRN: https://ssrn.com/abstract=227435

Alberto Giovannini (Contact Author)

Columbia University - Columbia Business School ( email )

3022 Broadway
New York, NY 10027
United States

Martha De Melo

World Bank - Development Research Group (DECRG)

1818 H. Street, N.W.
MSN3-311
Washington, DC 20433
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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