A monetary theory with non-degenerate distributions |
| |
Authors: | Guido Menzio Shouyong Shi Hongfei Sun |
| |
Institution: | 1. University of Pennsylvania, United States;2. NBER, United States;3. University of Toronto, Canada;4. CUFE, China;5. Queen?s University, Canada |
| |
Abstract: | We construct and analyze a tractable search model of money with a non-degenerate distribution of money holdings. Analytical tractability comes from modeling decentralized exchange as directed search, which makes the monetary steady state block recursive. By adapting lattice-theoretic techniques, we characterize individuals? policy and value functions, and show that these functions satisfy the standard conditions of optimization. We prove that a unique monetary steady state exists and provide conditions under which the steady-state distribution of buyers over money balances is non-degenerate. Moreover, we analyze the properties of this distribution. |
| |
Keywords: | E00 E4 C6 |
本文献已被 ScienceDirect 等数据库收录! |
|