'Shoe-leather' costs of inflation: some estimates for Brazil

Abstract

In this article we estimate the 'shoe-leather' costs of inflation in Brazil, which are obtained by calculating the area underneath the demand for money. Two specifications were used for the demand for money, namely, the log-log model and the semi-log model. As the demand for money became too unstable in recent years, it was estimated with quarterly data for the period 1966-1985. Our results were then compared with those obtained by other authors using similar or distinct methodologies for either Brazil or the United States and the United Kingdom.