Economics at your fingertips  

Equilibrium using credit or money with indivisible goods

Han Han, Benoit Julien (), Asgerdur Petursdottir and Liang Wang

Journal of Economic Theory, 2016, vol. 166, issue C, 152-163

Abstract: This note studies the trade of indivisible goods using credit or money in a frictional market. We show how indivisibility matters for monetary equilibrium under different assumptions about price determination. Bargaining generates a price and allocation that are independent of the nominal interest or inflation rate over some range. This is not the case with price posting and directed search. In either case, we provide conditions (the nominal rate cannot be too high) under which stationary monetary equilibrium exists, and we show it is unique or generically unique.

Keywords: Bargaining; Competitive search; Indivisibility; Uniqueness (search for similar items in EconPapers)
JEL-codes: D51 E40 (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Access Statistics for this article

Journal of Economic Theory is currently edited by A. Lizzeri and K. Shell

More articles in Journal of Economic Theory from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().

Page updated 2019-04-08
Handle: RePEc:eee:jetheo:v:166:y:2016:i:c:p:152-163