In this paper we study the inefficiencies of the monetary equilibrium and optimal monetary policies in a search economy …. We show that the same frictions that give fiat money a positive value generate an inefficient quantity of goods in each … trade and an inefficient number of trades (or search decisions). The Friedman rule eliminates the first inefficiency and the …

This paper studies the role of money in environments where in each meeting there is a double coincidence of real wants …. Traders who meet at random finance their purchases through current production, the sale of divisible money or both. It is … shown that in the absence of valued money if traders have asymmetric tastes for each other’s good, they produce and exchange …

This paper studies the validity of the Friedman rule in a search model with divisible money and divisible goods where … one emphasized in the labour-market literature. Buyers cannot obtain the full return that an additional unit of money … provides to the match, which makes the purchasing power of money inefficiently low in equilibrium. Consequently, even though …

This paper investigates the role of fiat money in decentralized markets, where producers have private information about … the quality of the goods they supply. Money is divisible, terms of trade are determined endogenously, and agents can … finance their consumption with money or with real production. When the fraction of high quality producers in the economy is …

consumption decisions in search-theoretic models of money. Our framework potentially generates three types of inefficiencies: the …We use alternative assumptions about the divisibility of goods and money and the ability of agents to use lotteries on … money to investigate to what extent the indivisibility of money is the cause for the typically inefficient production and …

consumption decisions in search-theoretic models of money. Our framework potentially generates three types of inefficiencies: the …We use alternative assumptions about the divisibility of goods and money and the ability of agents to use lotteries on … money to investigate to what extent the indivisibility of money is the cause for the typically inefficient production and …

We present a simple, finite-state search model to understand how the cross-sectional distribution of money affects its … value. We first document a network effect: the value of a given unit of money is higher when its distribution is even …. This approach is designed to be especially pertinent in the context of private issuance of money, in particular …

This paper generalizes the original random matching model of money by Kiyotaki and Wright (1989) (KW) in two aspects …

This paper uses an evolutionary approach to explain the origin of money as media of exchange in a primitive economy …

, agents have excess demand for or supply of money balances. Banks arise to reallocate excess cash by taking deposits from …