Why Ten $1's Are Not Treated as a $10

Pidong Huang () and Yoske Igarashi

MPRA Paper from University Library of Munich, Germany

Abstract: We study the stability of monetary steady states in a random matching model of money where money is indivisible, the bound on individual money holding is finite, and the trading protocol is buyer take-it-or-leave-it offers. The class of steady states we study have a non-full-support money-holding distribution and are constructed from the steady states of Zhu (2003). We show that no equilibrium path converges to such steady states if the initial distribution has a different support.

Keywords: random matching model; monetary steady state (search for similar items in EconPapers)
JEL-codes: E00 (search for similar items in EconPapers)
Date: 2013-04-30
New Economics Papers: this item is included in nep-dge, nep-mac and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

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Working Paper: Why Ten $1’s Are Not Treated as a $10 (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:46623

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