Sub-Optimality of the Friedman Rule in Townsends Turnpike and Limited Communication Models of money: Do finite lives and initial dates matter?

Joe Haslag (), Joydeep Bhattacharya and Antoine Martin
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Joe Haslag: Department of Economics, University of Missouri-Columbia, https://economics.missouri.edu/people/haslag

No 415, Working Papers from Department of Economics, University of Missouri

Abstract: We construct an economy populated with infinitely-lived agents and show that the Friedman rule is suboptimal. We do that by showing that our economy and an overlapping generations model in which the Friedman rule is known to be suboptimal are homomorphic. We also discuss the importance of whether or not the economy has an initial date for this result.

Keywords: Friedman rule; monetary policy; overlapping generations; turnpike. (search for similar items in EconPapers)
JEL-codes: E31 E51 E58 (search for similar items in EconPapers)
Pages: 18 pgs.
Date: 2004-12-21, Revised 2004-12-21
New Economics Papers: this item is included in nep-dge, nep-mac and nep-mon
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:umc:wpaper:0415

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