The emergence of money: Computational approaches with fully and boundedly rational agents

Zakaria Babutsidze and Maurizio Iacopetta ()
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Maurizio Iacopetta: SKEMA Business School - SKEMA Business School, GREDEG - Groupe de Recherche en Droit, Economie et Gestion - UNS - Université Nice Sophia Antipolis (1965 - 2019) - CNRS - Centre National de la Recherche Scientifique - UniCA - Université Côte d'Azur, OFCE - Observatoire français des conjonctures économiques (Sciences Po) - Sciences Po - Sciences Po

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Abstract: We discuss the emergence of money in a Kiyotaki and Wright (J Polit Econ 97:927–954, 1989) environment through two computational methodologies. One assumes that agents are fully rational and coordinate on Nash equilibria. The other considers boundedly rational agents whose choices are guided by a classifier system à la Marimon et al. (J Econ Dyn Control 14:329–373, 1990). We apply the two methodologies to study the conditions under which individuals can learn to play speculative strategies—to accept a high-storage-cost good as money. Our analysis suggests that, while in both types of systems money can emerge along a dynamic path, boundedly rational agents make conflicting choices at times, even when the classifier system provides clear information about the likely gains of a trade.

Keywords: Money; Rationality; Speculative strategies; Computational methods (search for similar items in EconPapers)
Date: 2019-03-04
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Published in Computational Economics, 2019, 58, pp.3-26. ⟨10.1007/s10614-019-09887-x⟩

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Related works:
Journal Article: The Emergence of Money: Computational Approaches with Fully and Boundedly Rational Agents (2021)
Working Paper: The Emergence of Money: Computational Approaches with Fully and Boundedly Rational Agents (2021)
Working Paper: The Emergence of Money: Computational Approaches with Fully and Boundedly Rational Agents (2021)
Working Paper: The emergence of money: Computational approaches with fully and boundedly rational agents (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:spmain:hal-02403894

DOI: 10.1007/s10614-019-09887-x

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