Alvarez, Fernando; Lippi, Francesco - Istituto Einaudi per l'Economia e la Finanza (EIEF) - 2013
We consider an inventory model for a liquid asset where the per-period net expenditures have two components: one that is frequent and small and another that is infrequent and large. We give a theoretical characterization of the optimal management of liquid asset as well as of the implied...