Non-robustness of the cash-in-advance equilibrium in the trading post model
AbstractThe main justification for cash-in-advance (CIA) equilibria when there are multiple assets is a Shapley-Shubik trading-post model where the agents coordinate on a particular medium of exchange. Of course, there are other equilibria. We introduce a refinement and show that the CIA equilibrium does not satisfy our refinement while there exist equilibria that do.
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Bibliographic InfoArticle provided by AccessEcon in its journal Economics Bulletin.
Volume (Year): 5 (2005)
Issue (Month): 3 ()
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