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==Explanation==
A shoe-leather cost is one of the impacts of inflation. In a period of high inflation, people are discouraged from holding large amounts of cash because its value deteriorates quickly relative to the rising prices in the economy. As a result, people tend to hold most of their money in a bank account and keep only very small amounts of cash with them. This causes them to make regular trips to their bank to withdraw cash to pay for goods and services. These regular trips wear out their shoe-leather, thus creating a 'shoe-leather cost'.▼
▲As a result, people tend to hold most of their money in a bank account and keep only very small amounts of cash with them. This causes them to make regular trips to their bank to withdraw cash to pay for goods and services. These regular trips wear out their shoe-leather, thus creating a 'shoe-leather cost'.
The shoe-leather cost is now used more generally to describe all the costs associated with having to hold small amounts of cash.<ref>{{cite web | url=http://www.romeconomics.com/shoe-leather-cost-explained/ | title=Shoe-Leather Cost Explained | publisher=romeconomics.com | date=May 16, 2014 | accessdate=October 26, 2016 | author=Roland Mortimer}}</ref>
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