The Dynamics of Money
AbstractWe present a dynamical many-body theory of money in which the value of money is a time dependent ``strategic variable'' that is chosen by the individual agents. The value of money in equilibrium is not fixed by the equations, and thus represents a continuous symmetry. The dynamics breaks this continuous symmetry by fixating the value of money at a level which depends on initial conditions. The fluctuations around the equilibrium, for instance in the presence of noise, are governed by the ``Goldstone modes'' associated with the broken symmetry. The idea is illustrated by a simple network model of monopolistic vendors and buyers.
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Bibliographic InfoPaper provided by arXiv.org in its series Papers with number cond-mat/9811094.
Date of creation: Nov 1998
Date of revision: May 1999
Publication status: Published in Phys. Rev. E 60, 2528-2532 (1999)
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- Chen-Zhong Qin & Lloyd S. Shapley & Martin Shubik, 2009. "Marshallian Money, Welfare, and Side-Payments," Cowles Foundation Discussion Papers 1729, Cowles Foundation for Research in Economics, Yale University.
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