Equilibrium selection in a fundamental model of money

Fundamental models of money always exhibit autarkic equilibria where money has no value. In this paper we propose a simple procedure to select among equilibria in such models. Our procedure unveils a natural mapping between equilibrium behavior and the primitives of the economy, thus offering insights on the conditions under which money emerges as a medium of exchange. Overall, our results favour money over autarky, especially if agents are patient.

MoreLess

Year of publication:	2011-01
Authors:	Araujo, Luis ; Guimarães, Bernardo
Institutions:	C.E.P.R. Discussion Papers
Subject:	equilibrium selection \| Money \| risk-dominance \| search

Online Resource

Check full text access |

More access options

Check Google Scholar

In German libraries (KVK)

I need help

More details

Extent:	application/pdf
Series:	CEPR Discussion Papers.
Type of publication:	Book / Working Paper
Notes:	Number 8200
Classification:	D83 - Search, Learning, Information and Knowledge ; E40 - Money and Interest Rates. General
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10008854470