Equilibrium traits of durable commodity money |
| |
Authors: | Bart Taub |
| |
Institution: | University of Virginia, Charlottesville, VA 22901, USA |
| |
Abstract: | A dynamic model of utility-maximizing agents explains why scarce, durable commodities are typically monetary. The model provides quantitative criteria for distinguishing between monetary and non-monetary durables, and is also used to analyze symmetallic equilibria.The model is then extended to analyze commodity-backed paper money. It is demonstrated that the backing generates trust in the paper money in the dynamic-consistency sense. The model predicts regular devaluations as an equilibrium phenomenon, but finds such behavior to be efficient. Finally, the results are integrated to make a technical point about dynamic models of pure fiat money. |
| |
Keywords: | |
本文献已被 ScienceDirect 等数据库收录! |
|