Individual and aggregate real balances in a random matching model

Ruilin Zhou ()

No 222, Staff Report from Federal Reserve Bank of Minneapolis

Abstract: This paper investigates the characteristics of stationary single-price equilibrium in a monetary random-matching model where agents can hold an arbitrary amount of divisible money and where production is costly. At such an equilibrium, agents? money holdings are endogenously determined and uniformly bounded. A refinement of weakly undominated strategies is argued to be necessary. It is shown that a continuum of single-price equilibria indexed by the aggregate real-money balance exists if one such equilibrium exists. Equilibria with different money-holdings upper bounds, hence different distributions, but with identical aggregate real-money balances, can coexist.

Keywords: Prices; Money theory (search for similar items in EconPapers)
Date: 1996
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Published in International Economic Review (Vol. 40, No. 4, November 1999, pp. 1009-1038)

Downloads: (external link)
https://www.minneapolisfed.org/research/sr/sr222.pdf Full Text (application/pdf)

Related works:
Journal Article: Individual and Aggregate Real Balances in a Random-Matching Model (1999)
Working Paper: Individual and Aggregate Real Balances in a Random Matching Model (1996)
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:fip:fedmsr:222

Access Statistics for this paper

More papers in Staff Report from Federal Reserve Bank of Minneapolis Contact information at EDIRC.
Bibliographic data for series maintained by Kate Hansel ().