A comment on: 'Efficient propagation of shocks and the optimal return on money'

Pidong Huang () and Yoske Igarashi

MPRA Paper from University Library of Munich, Germany

Abstract: Lotteries are introduced into Cavalcanti and Erosa (2008) [2], a version of Trejos and Wright (1995) [4] with aggregate shocks. Lotteries improve welfare and eliminate the two notable features of the optimum with deterministic trades: over-production and history-dependence. Moreover, the optimum can be supported by buyer take-it-or-leave-it offers.

Keywords: Random matching model of money; Aggregate shock; Optimal allocation; History-dependence; Lottery (search for similar items in EconPapers)
JEL-codes: C78 D61 D82 E30 E40 E50 (search for similar items in EconPapers)
Date: 2011-09-01
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Published in Journal of Economic Theory 1.147(2012): pp. 7-7

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Working Paper: A comment on: 'Efficient propagation of shocks and the optimal return on money' (2012)
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