Skip to main content

Regime-switching properties of the optimal seigniorage hypothesis: the case of Taiwan

Buy Article:

$53.17 plus tax (Refund Policy)


The optimal seigniorage hypothesis argues that the government will attempt to minimize the sum of social costs arising from the rate of inflation and taxation, which results in the testable prediction that inflation and rate of tax revenue will be positively correlated. This article empirically examines the regime-switching properties of this theory. Using quarterly data from Taiwan over 1961-2000 sampling periods, it finds that the optimal seigniorage hypothesis is weakly supported, and its explanatory power for the long-run inflation behaviour is weak.

Document Type: Research Article


Affiliations: Department of Finance, Shih Hsin University, No.1, Lane 17, Section 1, Mu-Cha Road, Taipei, 11602, Taiwan ROC. E-mail:

Publication date: January 1, 2003

More about this publication?

Access Key

Free Content
Free content
New Content
New content
Open Access Content
Open access content
Subscribed Content
Subscribed content
Free Trial Content
Free trial content
Cookie Policy
Cookie Policy
Ingenta Connect website makes use of cookies so as to keep track of data that you have filled in. I am Happy with this Find out more