# Inflation, the Payments Period, and the Demand for Money

@article{Barro1970InflationTP, title={Inflation, the Payments Period, and the Demand for Money}, author={Robert J. Barro}, journal={Journal of Political Economy}, year={1970}, volume={78}, pages={1228 - 1263} }

Part I of this paper develops a model of economic response to inflation. Sections A, B, and C consider the maximizing behavior of employers and employees in the context of a steady rate of inflation. Since the rate of price change can be translated into an effective cost of holding money, a higher rate provides increased incentive for economizing on cash balances. Two methods of economizing are considered: first, (Sections A and B), reductions of the time interval between various types of…

## 87 Citations

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