Equilibrium of incomplete markets with money and intermediate banking system
AbstractThis paper studies a simple stochastic two-period general equilibrium exchange model with money, an incomplete market of nominal assets, and a competitive banking system, intermediate between consumers and a Central Bank. There is a finite number of agents, consumers and banks. Default is not permitted. The public policy instruments are, besides real taxes implicit in the model, public debt and creation of money both implemented at the first period. The equilibrium existence is established under a Gains to trade hypothesis and the assumption that banks have a non zero endowment of money at each date-event of the model.
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Bibliographic InfoPaper provided by HAL in its series Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) with number halshs-00112209.
Date of creation: Nov 2006
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Competitive banking system; incomplete markets; nominal assets; money; monetary equilibrium; cash-in-advance constraints; public debt.;
Other versions of this item:
- Monique Florenzano & Stella Kanellopoulou & Yannis Vailakis, 2006. "Equilibrium of incomplete markets with money and intermediate banking system," Cahiers de la Maison des Sciences Economiques b06068, Université Panthéon-Sorbonne (Paris 1).
- C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
- C62 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Existence and Stability Conditions of Equilibrium
- D20 - Microeconomics - - Production and Organizations - - - General
- D46 - Microeconomics - - Market Structure and Pricing - - - Value Theory
- D51 - Microeconomics - - General Equilibrium and Disequilibrium - - - Exchange and Production Economies
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