Money is an experience good: Competition and trust in the private provision of money

Ramon Marimon, Juan Pablo Nicolini and Pedro Teles

Journal of Monetary Economics, 2012, vol. 59, issue 8, 815-825

Abstract: The interplay between competition and trust as efficiency-enhancing mechanisms in the private provision of money is studied. With commitment, trust is automatically achieved and competition ensures efficiency. Without commitment, competition plays no role. Trust does play a role but requires a bound on efficiency. Stationary inflation must be non-negative and, therefore, the Friedman rule cannot be achieved. The quality of money can be observed only after its purchasing capacity is realized. In this sense, money is an experience good.

Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (19)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0304393212001110
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Money is an experience good: competition and trust in the private provision of money (2012)
Working Paper: Money is an Experience Good: Competition and Trust in the Private Provision of Money (2011)
Working Paper: Money is an experience good: competition and trust in the private provision of money (2011)
Working Paper: Money is an Experience Good: Competition and Trust in the Private Provision of Money (2009)
Working Paper: Money is an Experience Good: Competition and Trust in the Private Provision of Money (2009)
Working Paper: Money is an Experience Good: Competition and Trust in the Private Provision of Money
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: https://EconPapers.repec.org/RePEc:eee:moneco:v:59:y:2012:i:8:p:815-825

DOI: 10.1016/j.jmoneco.2012.10.006

Access Statistics for this article

Journal of Monetary Economics is currently edited by R. G. King and C. I. Plosser

More articles in Journal of Monetary Economics from Elsevier
Bibliographic data for series maintained by Catherine Liu ().