recognition to the intertemporal nature of households' saving decisions. Like traditional IS-LM, however, the optimizing version … tends to understate the value of money as an indicator for monetary policy. …

. Specifically, they characterize the optimal return on money in the presence of credit arrangements. There is a dual role for credit …: It allows buyers to trade without fiat money and also permits them to borrow against future income. However, not all … traders have access to credit. As a result, there is a social role for fiat money because it allows agents to self …

determined by steady-state money growth. Woodford instead argues that the intercept term in the monetary authority's interest …, according to which it is appropriate to regard steady-state inflation as determined by steady-state money growth. The argument … the money growth rate. …

the origin of the aggregate volatility reduction. We show that states with relatively high concentrations in the durable-goods …