In the second, a simple analytical framework is used to demonstrate and, where possible, estimate the seigniorage
costs of the provisions attached to these notes.
14) This implies that revenue from seigniorage
has been approximately 2 percent of GDP.
Even if the team did succeed in pushing the update, however, it would still be unable to collect seigniorage
from the expansion without further changes involving the rewards to mining.
4) Since 2009, the Fed has produced a larger than average amount of seigniorage
because the Fed has earned greater interest revenue due to the large expansion of the Fed's balance sheet to treat the financial crisis.
Inflating the money supply in an attempt to generate seigniorage
revenue may entail increased price inflation.
On the other hand, the benefits include income from seigniorage
, the use of RRs as a countercyclical policy, and, in the presence of high agency costs, a restraint on the inefficiencies of the banking system.
This is true for two reasons: one is that its equity must include its future stream of earnings from seigniorage
, currently thought to amount to EUR2-3tn in the case of the ECB.
Keywords Inflation tax on money * Seigniorage
* Milton Friedman
As a consequence, they often rely heavily on financing the deficit by printing new money - also called seigniorage
Turning to liquidity and reserve requirements, they address the effects of currency and reserve requirements on the financial positions of economic sectors, the basics of financial statements, structures of the central bank's balance sheet, and administration of the international reserves and seigniorage
This would preserve seigniorage
and government control of the national unit of money, to name but two advantages.
When an economy relies heavily on seigniorage
revenues, its average level of seigniorage
should be high.