A Strategic Market Game with a Mutual Bank with Fractional Reserves and Redemption in Gold (A Continuum of Traders)
AbstractWe utilize the strategic market game approach to analyze the role and function of a mutual bank with variable fractional reserves, redemption in gold and endogenous interest rate formation. We specify the conditions of enough money and its distribution. Using the continuum of traders model, we show existence and optimality for the case of no bankruptcy as well as for the case in which there exists the potentiality of bankruptcy. Finally, we analyze the relationship of the gearing ratio and the bankruptcy penalty with respect to the resulting equilibrium allocations.
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Bibliographic InfoPaper provided by Cowles Foundation for Research in Economics, Yale University in its series Cowles Foundation Discussion Papers with number 964.
Length: 24 pages
Date of creation: Dec 1990
Date of revision:
Publication status: Published in Journal of Economics (1992), 55(2): 123-150
Note: CFP 812.
Contact details of provider:
Postal: Yale University, Box 208281, New Haven, CT 06520-8281 USA
Phone: (203) 432-3702
Fax: (203) 432-6167
Web page: http://cowles.econ.yale.edu/
More information through EDIRC
Postal: Cowles Foundation, Yale University, Box 208281, New Haven, CT 06520-8281 USA
Find related papers by JEL classification:
- G33 - Financial Economics - - Corporate Finance and Governance - - - Bankruptcy; Liquidation
- G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
- E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers
- E43 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Interest Rates: Determination, Term Structure, and Effects
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- John Geanakoplos & Pradeep Dubey, 1989. "Liquidity and Bankruptcy with Incomplete Markets: Pure Exchange," Cowles Foundation Discussion Papers 900, Cowles Foundation for Research in Economics, Yale University.
- Martin Shubik, 1984.
"A Note on Enough Money in a Strategic Market Game with Complete or Fewer Markets,"
Cowles Foundation Discussion Papers
730, Cowles Foundation for Research in Economics, Yale University.
- Shubik, Martin, 1985. "A note on enough money in a strategic market game with complete or fewer markets," Economics Letters, Elsevier, vol. 19(3), pages 231-235.
- Martin Shubik & Shuntian Yao, 1989. "The Transactions Cost of Money (A Strategic Game Analysis)," Cowles Foundation Discussion Papers 903, Cowles Foundation for Research in Economics, Yale University.
- Martin Shubik, 1990. "The transactions trust demand for money," Journal of Economics, Springer, vol. 52(3), pages 211-232, October.
- Martin Shubik, 1986.
"The Unique Minimal Cash Flow Competitive Equilibrium,"
Cowles Foundation Discussion Papers
806, Cowles Foundation for Research in Economics, Yale University.
- Shubik, Martin, 1987. "The unique minimal cash flow competitive equilibrium," Economics Letters, Elsevier, vol. 25(4), pages 303-306.
- Shubik, Martin & Yao, Shuntian, 1990. "The transactions cost of money (a strategic market game analysis)," Mathematical Social Sciences, Elsevier, vol. 20(2), pages 99-114, October.
- Martin Shubik, 1986. "Enough Commodity Money and the Selection of a Unique Competitive Equilibrium," Cowles Foundation Discussion Papers 804, Cowles Foundation for Research in Economics, Yale University.
- Dimitrios P. Tsomocos & Martin Shubik, 2002.
"A strategic market game with seigniorage costs of Fiat money,"
Springer, vol. 19(1), pages 187-201.
- Martin Shubik & D.P. Tsomocos, 1993. "A Strategic Market Game with Seigniorage Costs of Fiat Money," Cowles Foundation Discussion Papers 1043, Cowles Foundation for Research in Economics, Yale University.
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