We construct a model in which capital competes with fiat money as a medium of exchange, and establish conditions on … fundamentals under which fiat money can be both valued and socially beneficial. When the socially efficient stock of capital is too … rule, fiat money provides just enough liquidity so that agents choose to accumulate the same capital stock a social planner …

I study random-matching economies where at money coexists with real assets, and no restrictions are imposed on payment … the usefulness of at money. The liquidity of the real asset, as measured by its transaction velocity, is shown to depend …

constitutes progress on the classic problem of integrating money and general equilibrium theory. We also use the model to discuss …

model with divisible money, we show how this choice matters for important results such as the ability of the optimal …

equilibrium); and price posting (competitive search equilibrium). We also extend work on the microfoundations of money by allowing …

money coexists with a real asset, and no restrictions are imposed on payment arrangements. The liquidity of the real asset …

analyze an economy where there is no transaction demand for money balances: Money is a mere unit of account. We determine a … transaction role for money. In the absence of menu costs, the Friedman rule is optimal. In the presence of menu costs, the optimal …