Ex-ante production, directed search and indivisible money

Richard Dutu () and Benoit Julien ()

Economics Bulletin, 2008, vol. 5, issue 7, pages 1-7

Abstract: There always exists a monetary equilibrium when search is directed, money is indivisible and production is on demand (Julien Kennes King 2007). We demonstrate that when production takes place before exchange, forcing sellers to incur a sunk cost, there must be a minimum buyer-seller ratio for the monetary equilibrium to survive.

Keywords: Money; Directed Search; Sunk Cost (search for similar items in EconPapers)
JEL-codes: E4 D4 (search for similar items in EconPapers)
Date: 2008-02-25
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