Payments Systems with Random Matching and Private Information

Stephen Williamson

Game Theory and Information from University Library of Munich, Germany

Abstract: A model of dynamic risk sharing is constructed where agents meet pairwise and at random, and there is private information about endowments. Risk sharing is accomplished through dynamic contracts involving credit transactions, and through monetary exchange. A Friedman rule is optimal, and solutions are computed. The welfare costs of inflation and the effects of inflation on the distribution of consumption and wealth are small for an economy calibrated to U.S. data. However, these effects are large when the credit system is relatively unsophisticated.

Keywords: 97-21 (search for similar items in EconPapers)
JEL-codes: C7 D8 (search for similar items in EconPapers)
Pages: 36 pages
Date: 1998-02-04
Note: Type of Document - PDF; prepared on Acrobat PDF; pages: 36 ; figures: included
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Citations: View citations in EconPapers (6)

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Related works:
Journal Article: Payment systems with random matching and private information (1998)
Journal Article: Payments Systems with Random Matching and Private Information (1998)
Working Paper: Payments Systems with Random Matching and Private Information (1997)
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Persistent link: https://EconPapers.repec.org/RePEc:wpa:wuwpga:9802004

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