Contagion Equilibria in a Monetary Model
6 Pages Posted: 23 Dec 2014
Date Written: December 22, 2014
Abstract
The model of Lagos and Wright [9] alters the meeting friction of the typical search model of money to obtain degeneracy in equilibrium holdings and enhance analytical tractability. It introduces a round of Walrasian ‘centralized’ trading after each round of bilateral random ‘decentralized’ trading. The basic premise is that, although the population meets repeatedly in the centralized market, anonymity and random pairings are frictions sufficient for money to be essential (see [9, p. 466] or [11, p. 175]; for the essentiality see [6, 8]).
Suggested Citation: Suggested Citation
Do you have negative results from your research you’d like to share?
Recommended Papers
-
By S. Borağan Aruoba, Christopher J. Waller, ...
-
Money and Capital as Competing Media of Exchange
By Ricardo Lagos and Guillaume Rocheteau
-
Information, Liquidity and Asset Prices
By Benjamin R. Lester, Andrew Postlewaite, ...
-
Money and Capital: A Quantitative Analysis
By S. Borağan Aruoba, Christopher J. Waller, ...
-
Inflation and Unemployment in the Long Run
By Aleksander Berentsen, Guido Menzio, ...
-
Inflation and Unemployment in the Long Run
By Aleksander Berentsen, Guido Menzio, ...
-
Anonymous Markets and Monetary Trading
By Charalambos D. Aliprantis, Gabriele Camera, ...
-
Inflation and Unemployment in the Long Run
By Aleksander Berentsen, Guido Menzio, ...
-
Inflation and Welfare: A Search Approach
By Ben R. Craig and Guillaume Rocheteau