Asset Dynamics, Liquidity, and Inequality in Decentralized Markets

Maurizio Iacopetta () and Raoul Minetti
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Maurizio Iacopetta: SKEMA Business School - SKEMA Business School

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Abstract: Kiyotaki and Wright (1989) model has exerted considerable in ‡uence in the monetary search literature. We argue that the model delivers also important insights on a broader range of macroeconomic and development issues. The analysis studies how market frictions and the liquidity of assets a¤ect the distribution of income. Experiments illustrate how the economy adjusts to shocks to assets' returns and to the matching technology. They also deal with long-run transition. An experiment interprets the reversal of fortune hypothesis as a situation in which an economy with a low-return asset takes over a similar economy with a high-return asset.

Keywords: Trading Strategies; Liquidity; Matching; Decentralized Markets (search for similar items in EconPapers)
Date: 2019
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-03515555v1
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Citations: View citations in EconPapers (2)

Published in Economic Inquiry, 2019

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Related works:
Journal Article: ASSET DYNAMICS, LIQUIDITY, AND INEQUALITY IN DECENTRALIZED MARKETS (2019)
Working Paper: Asset dynamics, liquidity, and inequality in decentralized markets (2019)
Working Paper: Asset dynamics, liquidity, and inequality in decentralized markets (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:halshs-03515555

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