This article considers an overlapping generations model with nominal idiosyncratic shocks. Such shocks are described as if they are exogenous nominal taxes/subsidies and cause nondegenerate ex-post distributions of money. We then show that the optimal money growth rate exists and is greater than one

This article examines the optimality of the Freidman rule in an overlapping generations model with spatial separation, wherein asymmetric liquidity shocks are observed. Suboptimality of the Freidman rule is shown. Furthermore, when the number of locations is sufficiently large, there is no room...