00000nam 2200000za 4500 9.862201 CaOODSP 20221107160944 cr ||||||||||| 180920s2018 oncd ob f000 0 eng d CaOODSP eng eng fre FB3-5/2018-40E-PDF The welfare cost of inflation revisited [electronic resource] : the role of financial innovation and household heterogeneity / by Shutao Cao … [et al.]. [Ottawa] : Bank of Canada, 2018. ii, 51 p. : col. charts. Bank of Canada staff working paper, 1701-9397 ; 2018-40 "August 2018." Includes bibliographical references (p. 41-42). "This paper calculates the welfare cost of inflation by focusing on distortions and costs that inflation poses on households who use money for transactions to avoid alternative means of payment and on the losses inflicted on the holders of public debt arising from unexpected inflation. In doing so, we take into account of the role of financial innovation that reduces over time the dependence of households on money to make transactions. We find a sizable aggregate welfare cost of money holdings, but lower than those found in previous studies. The difference mainly comes from the incorporation of financial innovation in our studies. Across households, the old and middle-aged and the poor face higher costs from inflation much more than the young and the rich. Costs are expected to be lower for future generations due to financial innovation"--Non-technical summary. Includes abstract in French. gccst Inflation gccst Standard of living Cao, Shutao. Bank of Canada. Staff working paper (Bank of Canada) 1701-9397 ; 2018-40. (CaOODSP)9.806221 PDF 793 KB https://publications.gc.ca/collections/collection_2018/banque-bank-canada/FB3-5-2018-40-eng.pdf