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Model Uncertainty and Endogenous Volatility

Branch, William; Evans, George W. - In: Review of Economic Dynamics 10 (2007) 2, pp. 207-237

This paper identifies two channels through which the economy can generate endogenous inflation and output volatility, an empirical regularity, by introducing model uncertainty into a Lucas-type monetary model. The equilibrium path of inflation depends on agents' expectations and a vector of...

Persistent link: https://www.econbiz.de/10005069600

Model Uncertainty and Endogenous Volatility

Branch, Wiliam; Evans, George W. - Department of Economics, University of Oregon - 2005

Persistent link: https://www.econbiz.de/10005464125

Monetary Policy with Incomplete Markets

Gourdel; Triki - EconWPA - 2005

We consider an extension of a general equilibrium model with incomplete markets that considers cash-in-advance constraints. The total amount of money is supplied by an authority, which produces at no cost and lends money to agents at short term nominal rates of interest, meeting the demand....

Persistent link: https://www.econbiz.de/10005413123

Unstable and stable steady-states in the Kiyotaki-Wright model

Renero, Juan-Manuel - In: Economic Theory 11 (1998) 2, pp. 275-294

I provide new results concerning dynamics for a version of the Kiyotaki-Wright model (1989) in which strategies (either mixed or pure) are restricted so that agents play the same strategy for each opportunity set. My results demonstrate the importance of examining stability in such models,...

Persistent link: https://www.econbiz.de/10005597800

Welfare Theorema and Core Equivalence without Divisible Goods

Florig, Michael; Cayupi, Jorge Rivera - Departamento de Economía, Facultad de Economía y Negocios - 2002

We study economies where all commodities are indivisible at the individual level, but perfectly divisible at the aggregate level. Paper (fiat) money which does not influence agents preferences may be used to facilitate exchange. In a parallel paper (Florig and Rivera (2002), we introduced a...

Persistent link: https://www.econbiz.de/10010614955

Heterogeneous beliefs and learning in forward looking economic models*

Barucci, Emilio - In: Journal of Evolutionary Economics 9 (1999) 4, pp. 453-464

We study a class of forward looking economic models with heterogeneous agents in a bounded rationality setting. The agents employ the same recursive learning rule to update beliefs but are characterized by different memory parameters. The peculiarity of the learning mechanism is that the...

Persistent link: https://www.econbiz.de/10005622522

Random Matching Models and Money : The Global Structure and Approximation of Stationary Equilibria

Talman, Dolf; Kamiya, K. - Tilburg University, Center for Economic Research - 2003

Random matching models with different states are an important class of dynamic games; for example, money search models, job search models, and some games in biology are special cases.In this paper, we investigate the basic structure of the models: the existence of equilibria, the global...

Persistent link: https://www.econbiz.de/10011090770

The dynamics of instability

Barilla, César; Gonçalves, Duarte - In: Theoretical Economics 19 (2024) 1, pp. 365-405

We study a model in which two players with opposing interests try to alter a status quo through instability …-generating actions. We show that instability can be used to secure longer-term durable changes, even if it is costly to generate and does … not generate short-term gains. In equilibrium, instability generated by a player decreases when the status quo favors them …

Persistent link: https://www.econbiz.de/10014536977

Money and Prices: A Model of Search and Bargaining

Shi, Shouyong - 1995

This paper makes commodities divisible and incorporates bargaining into the search-theoretic model of money to determine the purchasing power of money (or price). It is shown that two monetary equilibria always coexist where flat money is universally accepted. The two equilibria differ in price,...

Persistent link: https://www.econbiz.de/10011940575

Credit and Money in a Search Model with Divisible Commodities

Shi, Shouyong - 1995

This paper examines the competition between money and credit in a search model with divisible commodities. It is shown that flat money can be valuable even though it yields a lower rate of return than the coexisting credit. The competition between money and credit increases efficiency. The...

Persistent link: https://www.econbiz.de/10011940576