, as well as the distribution of money. As inflation decreases, agents are induced to participate less frequently in the … centralized liquidity market, leading to a lower velocity of money, a smaller liquidity market, fewer resources spent on market … participation and higher heterogeneity in money holdings across agents. The welfare costs of inflation implied are different from …

rate. Money’s role in monetary policy has been tertiary, at best. Indeed, several influential economists have suggested … that money is irrelevant for monetary policy. They suggest that central banks can control inflation by (i) controlling a … rate in order to exert greater control over longer-term rates. I offer an alternative perspective: namely, that money is …