We develop a monetary model in which a private company issues digital currency and uses payment data to estimate consumers' preferences. Sellers purchase preference information to produce goods that better match consumers' preferences. A monopoly arises in the digital currency industry, and...

We develop a monetary model in which a private company issues digital currency and uses payment data to estimate consumers' preferences. Sellers purchase preference information to produce goods that better match consumers' preferences. A monopoly arises in the digital currency industry, and...

We develop a dynamic model of debt contracts with adverse selection and belief updates. In the model, entrepreneurs borrow investment goods from lenders to run businesses whose returns depend on entrepreneurial productivity and common productivity. Entrepreneurial productivity is the...

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...

I study the conditions under which assets are sold or used as collateral. Secured loans can be optimal by reducing the lender's incentives to acquire costly information about the future value of collateral assets. Furthermore, when the borrower has incentives to falsify the assets' quality, the...

We develop a model of asset exchange and monetary policy, augmented to incorporate a housing market and a frictional financial market. Homeowners take out mortgages with banks using their residential properties as collateral to finance consumption. Banks use mortgages and government liabilities...