A drift formulation of Gresham's Law

Reginald D. Smith

Papers from arXiv.org

Abstract: In this paper we analyze Gresham's Law, in particular, how the rate of inflow or outflow of currencies is affected by the demand elasticity of arbitrage and the difference in face value ratios inside and outside of a country under a bimetallic system. We find that these equations are very similar to those used to describe drift in systems of free charged particles. In addition, we look at how Gresham's Law would play out with multiple currencies and multiple countries under a variety of connecting topologies.

Date: 2012-01, Revised 2012-04
References: Add references at CitEc
Citations:

Published in Hyperion international journal of econophysics & new economy, volume 5, issue 1, 2012, p. 71-84

Downloads: (external link)
http://arxiv.org/pdf/1201.3580 Latest version (application/pdf)

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: https://EconPapers.repec.org/RePEc:arx:papers:1201.3580

Access Statistics for this paper

More papers in Papers from arXiv.org
Bibliographic data for series maintained by arXiv administrators ().