:: Volume 9, Issue 1 (Winter 2014) ::
J. Mon. Ec. 2014, 9(1): 93-115 Back to browse issues page
Estimation of Seigniorage Laffer curve in IRAN: A Fuzzy C-Means Clustering Framework
Solmaz Safari Mrs 1
1- Semnan University
Abstract:   (2328 Views)

There are two sources for governments to raise their revenues. The first is the direct taxation levied on output, and the second is seigniorage. Seigniorage is also known as printing new money and is defined as the value of real resources acquired by the government through its power of sovereignty on its monopoly of printing money. The purpose of this paper is to examine the Laffer curve for Seigniorage in the economy of Iran through data-set collected from the statistical books of the central bank of Iran related to the time period 1979-2010. For this purpose, we use a methodology that is based on the Fuzzy C-Means algorithm that is widely used in the context of pattern recognition, and the Takagi-Sugeno approach which is proper for modeling fuzzy systems. This methodology is exceptionally flexible and provides a computationally tractable method of dealing with non-linear models in high dimensions. Our findings support a standard Laffer curve shape in Iran. In other words, it will be concluded through empirical results that there is a nonlinear relationship between seigniorage and inflation for the economy of Iran in the time period studied in this paper.

JEL Classification: E43, E52, E62

Keywords: Seigniorage, Takagi-Sugeno approach, Fuzzy systems, Bootstrap, Iran
Full-Text [PDF 663 kb]   (1282 Downloads)    
Type of Study: Original Research - Theoric | Subject: Economics
Received: 27 Nov 2014 | Accepted: 22 Oct 2016 | Published: 22 Oct 2016

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Volume 9, Issue 1 (Winter 2014) Back to browse issues page