. Theoretically, we show that the cashless limit of the monetary equilibrium (as the cash-and-credit economy converges to a pure …-credit economy) need not correspond to the equilibrium of the nonmonetary pure-credit economy. Quantitatively, we find that the … magnitudes of the responses of prices and allocations to monetary policy in the monetary economy are sizeable—even in the …

propose a comprehensive description of how monetary policy affects the euro area economy. We focus mainly on three questions …