Many commentators have argued that if the Federal Reserve had followed a stricter monetary policy earlier this decade when the housing bubble was forming, and if Congress had not deregulated banking but had imposed tighter financial standards, the housing boom and bust - and the subsequent...

Can a cryptocurrency, Bitcoin, compete with central bank-issued money as a medium of exchange? We develop a search theoretic model where both money and Bitcoin can be used as a means of payment in transactions, and currency choices are endogenously determined. We analytically study the necessary...

Fiat money requires no backing to be accepted at a uniquely determined positive value. I show this using an equilibrium model with realistic frictions and rational households allowed to freely interact in a competitive environment. The model portrays a modern 'cashless' economy relying on...