Money and capital

S. Boragan Aruoba, Christopher Waller and Randall Wright

No 714, Working Papers (Old Series) from Federal Reserve Bank of Cleveland

Abstract: We revisit classic questions concerning the effects of money on investment in a new framework: a two-sector model where some trade occurs in centralized and some in decentralized markets, as in recent monetary theory, but extended to include capital. This allows us to incorporate novel elements from the microfoundations literature on trading with frictions, including stochastic exchange opportunities, alternative pricing mechanisms, etc. We calibrate models with bargaining and with price taking in the decentralized market.

Keywords: Money; Capital; Monetary policy (search for similar items in EconPapers)
Date: 2007
New Economics Papers: this item is included in nep-cba, nep-dge, nep-mac and nep-mon
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Citations: View citations in EconPapers (18)

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Related works:
Journal Article: Money and capital (2011)
Working Paper: Money and Capital (2005)
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedcwp:0714

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DOI: 10.26509/frbc-wp-200714

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