In this study, the author demonstrates that the selection of an appropriate money-demand function is crucial to ascertain the relationship between fiscal deficits and inflation. To do so, the author incorporates a Selden-Latané money-demand function into a micro-founded extension of the model...

A model is constructed in which completely unbacked fiat money, issued by generic supplier implementing realistically specified monetary policy designed to obey certain sufficient conditions, is endogenously accepted by rational individuals at uniquely determined price level. The model...

This paper studies the valuation of fiat money in an endowment economy with specialization, costly barter, and imperfect enforcement of promises using a generalized asset-pricing framework of Lucas (1978). The environment features symmetric, competitive, and indefinitely-lived households and...

This paper addresses the perspective of Hayek’s doctrine on monetary arrangements in the economy and his favorable argument for an international central bank over national central bank. I also discussed Hayek’s view on free banking (i.e. for the free issue of bank notes) that would enable...

The sustained elevated gold price domestically, hovering persistently above the global market price, underscores the peculiar nature of the gold market in Vietnam and the resiliently strong demand for gold in the local market. In particular, the movements in the price of gold seem to lead a...

Using Japanese money market data, this paper compares the predictive ability of the log-log specification with infinite elasticity at a zero interest rate and the semilog specification with a one time switch from moderate to relatively high semielasticity at annual interest rates less than 0.5%....

Based on a standard model of money demand, this paper first shows that a relationship between money supply and prices may be substantially weakened when money demand is highly interest-elastic, and then presents empirical evidence for this implication using the Japanese money market data for the...

This paper examines the effect of monetary policy on the liquidity premium, i.e., the market value of the liquidity services that financial assets provide. To guide the empirical analysis, I set up a monetary search model in which bonds provide liquidity services in addition to money. The theory...

This paper examines the effect of monetary policy on the liquidity premium, i.e., the market value of the liquidity services that financial assets provide. To guide the empirical analysis, I set up a monetary search model in which bonds provide liquidity services in addition to money. The theory...

This paper examines the effect of monetary policy on the liquidity premium, i.e., the market value of the liquidity services that financial assets provide. To guide the empirical analysis, I set up a monetary search model in which bonds provide liquidity services in addition to money. The theory...