On recursive utility and the superneutrality of money

Kenji Miyazaki

Economic Modelling, 2013, vol. 32, issue C, 483-487

Abstract: This paper investigates whether a change in the growth rate of the money supply enhances the rate of capital accumulation in a cash-in-advance monetary model with recursive utility. Although money is superneutral in the steady state, the effect of the growth rate of money supply on the speed of capital accumulation depends not only on the curvature of the felicity, but also on the slope and curvature of the discount rate function. We find that when the discount rate decreases with consumption and the elasticity of marginal utility is greater than unity, inflation yields a slower speed of capital accumulation.

Keywords: Endogenous time preference; Superneutrality; Transition path; Cash-in-advance; Complementarity (search for similar items in EconPapers)
JEL-codes: O42 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecmode:v:32:y:2013:i:c:p:483-487

DOI: 10.1016/j.econmod.2013.02.039

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