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On the Micro-foundations of Money: The Capitol Hill Baby-Sitting Co-op

We suggest a new micro-foundation of money in which markets are well-organized but consumers' preferences are stochastic. In this model, we solve for stationary equilibria and show that there is an optimum quantity of money. The rational solution of our model is compared with actual behavior in a laboratory experiment. It turns out that the experiment gives support to our theoretical results.
Authors: Hens, Thorsten ; Schenk-Hoppé, Klaus Reiner ; Vogt, Bodo
Institutions: Institut für Volkswirtschaftslehre, Wirtschaftswissenschaftliche Fakutät
Subject: micro foundations of money | optimal quantity of money
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Series:
IEW - Working Papers. - ISSN 1424-0459.
Type of publication: Book / Working Paper
Notes:
The text is part of a series IEW-working papers Number 108
Classification: C91 - Laboratory, Individual Behavior ; C92 - Laboratory; Group Behavior
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Persistent link: https://www.econbiz.de/10005627808
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