Abstract
This paper examines the relationship between the state budget deficit and the inflation tax, challenging the traditional Keynesian view that higher deficits stimulate economic activity. The author, Ahmed Zejly, argues that conventional deficit definitions overlook resource transfers caused by price increases between the state budget and other economic agents, thereby overestimating the true deficit. Using Moroccan data, the paper proposes a refined definition that accounts for these inflationary transfers. It also explores the limits of using the inflation tax as a means of financing the budget deficit. The analysis contributes to a more nuanced understanding of fiscal policy and its macroeconomic implications during inflationary periods.
Recommended Citation
Zejly, Ahmed
(1989)
"Budget Deficit and Inflation Tax,"
Revue Marocaine de Droit, d'Economie et de Gestion (Moroccan Journal of Law, Economics and Management): Vol. 8:
Iss.
2, Article 10.
https://doi.org/10.66499/2665-7112.1690
Available at:
https://scholarhub.univh2c.ma/remadeg/vol8/iss2/10
DOI
10.66499/2665-7112.1690