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A Theory Of Money And Marketplaces

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  • Akihiko Matsui
  • Takashi Shimizu

Abstract

This article considers an infinitely repeated economy with divisible fiat money. The economy has many marketplaces that agents choose to visit. In each marketplace, agents are randomly matched to trade goods. There exist a variety of stationary equilibria. In some equilibrium, each good is traded at a single price, whereas in another, every good is traded at two different prices. There is a continuum of such equilibria, which differ from each other in price and welfare levels. However, it is shown that only the efficient single-price equilibrium is evolutionarily stable. Copyright 2005 by the Economics Department Of The University Of Pennsylvania And Osaka University Institute Of Social And Economic Research Association.

Suggested Citation

  • Akihiko Matsui & Takashi Shimizu, 2005. "A Theory Of Money And Marketplaces," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 46(1), pages 35-59, February.
  • Handle: RePEc:ier:iecrev:v:46:y:2005:i:1:p:35-59
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    Citations

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    Cited by:

    1. Nicolas L. Jacquet & Serene Tan, 2007. "On the Segmentation of Markets," Journal of Political Economy, University of Chicago Press, vol. 115(4), pages 639-664, August.
    2. Kazuya Kamiya & Takashi Shimizu, 2010. "Hysteresis in Dynamic General Equilibrium Models with Cash-in-Advance Constraints," CIRJE F-Series CIRJE-F-765, CIRJE, Faculty of Economics, University of Tokyo.
    3. Kazuya Kamiya & Takashi Shimizu, 2005. "On the Role of Tax-Subsidy Scheme in Money Search Models (Subsequently published in "International Economic Review" 48, 2007, 575-606. )," CARF F-Series CARF-F-025, Center for Advanced Research in Finance, Faculty of Economics, The University of Tokyo.
    4. Kamiya, Kazuya & Shimizu, Takashi, 2011. "Stationary monetary equilibria with strictly increasing value functions and non-discrete money holdings distributions: An indeterminacy result," Journal of Economic Theory, Elsevier, vol. 146(5), pages 2140-2150, September.
    5. Kazuya Kamiya & Takashi Shimizu, 2007. "On The Role Of Tax Subsidy Scheme In Money Search Models," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 48(2), pages 575-606, May.
    6. repec:eee:jetheo:v:172:y:2017:i:c:p:423-450 is not listed on IDEAS
    7. Kazuya Kamiya & Takashi Shimizu, 2006. "A Dynamic General Equilibrium Model with Centralized Auction Markets," CIRJE F-Series CIRJE-F-417, CIRJE, Faculty of Economics, University of Tokyo.
    8. Kazuya Kamiya & Hajime Kobayashi & Tatsuhiro Shichijo & Takashi Shimizu, 2017. "Equilibrium Selection in Monetary Search Models: An Experimental Approach," Discussion Paper Series DP2017-03, Research Institute for Economics & Business Administration, Kobe University.
    9. Trejos, Alberto & Wright, Randall, 2016. "Search-based models of money and finance: An integrated approach," Journal of Economic Theory, Elsevier, vol. 164(C), pages 10-31.
    10. Kamiya, Kazuya & Shimizu, Takashi, 2006. "Real indeterminacy of stationary equilibria in matching models with divisible money," Journal of Mathematical Economics, Elsevier, vol. 42(4-5), pages 594-617, August.
    11. Bech, Morten & Monnet, Cyril, 2016. "A search-based model of the interbank money market and monetary policy implementation," Journal of Economic Theory, Elsevier, vol. 164(C), pages 32-67.
    12. repec:bla:jecrev:v:68:y:2017:i:4:p:497-520 is not listed on IDEAS
    13. Kazuo Mino, 2008. "Announcement," The Japanese Economic Review, Japanese Economic Association, vol. 59(1), pages 17-18.

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