EconPapers    
Economics at your fingertips  
 

Monetary Equilibria over an Infinite Horizon

Gaetano Bloise, Jacques Dreze and H. M. Polemarchakis
Additional contact information
H. M. Polemarchakis: Brown University

No 03-19, Discussion Papers from University of Copenhagen. Department of Economics

Abstract: Money provides liquidity services through a cash-in-advance constraint. The exchange of commodities and assets extends over an infinite horizon under uncertainty and a sequentially complete asset market. Monetary policy sets the path of rates of interest and accommodates the demand for balances. A public authority, inheriting a strictly positive public debt, raises revenue from taxes and seignorage. Competitive equilibria exist, under mild solvency conditions. But, for a fixed path of rates of interest, there is a nontrivial multiplicity of equilibrium paths of prices of commodities. Determinacy requires that, subject to no-arbitrage and in addition to rates of interest, the prices of state-contingent revenues be somehow determined.

Keywords: money; equilibrium; indeterminacy; monetary policy; fiscal policy (search for similar items in EconPapers)
JEL-codes: D50 E40 E50 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cba and nep-mac
Date: 2003-04
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (21) Track citations by RSS feed

Downloads: (external link)
http://www.econ.ku.dk/english/research/publications/wp/2003/0319.pdf/ (application/pdf)

Related works:
Journal Article: Monetary equilibria over an infinite horizon (2005) Downloads
Working Paper: Monetary equilibria over an infinite horizon (2005) Downloads
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:kud:kuiedp:0319

Access Statistics for this paper

More papers in Discussion Papers from University of Copenhagen. Department of Economics Øster Farimagsgade 5, Building 26, DK-1353 Copenhagen K., Denmark. Contact information at EDIRC.
Bibliographic data for series maintained by Thomas Hoffmann ().

 
Page updated 2019-07-13
Handle: RePEc:kud:kuiedp:0319