General Preferences for Consumption Goods in the Random Matching Model of Commodity Money
Xavier Cuadras Morató
Universitat Pompeu Fabra - Faculty of Economic and Business Sciences
UPF Economics and Business Working Paper No. 706
This paper generalizes the original random matching model of money by Kiyotaki and Wright (1989) (KW) in two aspects: first, the economy is characterized by an arbitrary distribution of agents who specialize in producing a particular consumption good; and second, these agents have preferences such that they want to consume any good with some probability. The results depend crucially on the size of the fraction of producers of each good and the probability with which different agents want to consume each good. KW and other related models are shown to be parameterizations of this more general one.
Number of Pages in PDF File: 20
Keywords: Commodity money, random matching, general preferences
JEL Classification: C73, D83, E00working papers series
Date posted: July 10, 2004
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