Equilibrium Concepts in the Large Household Model
This paper formulates two alternative equilibrium concepts in the large household model: one which allows individual household agents to make choices in their separate meetings, and the other which commits individual household agents to contingent actions prior to their meetings. In the first formulation, large converts a model with nonlinear preferences for the household into one with quasi-linear preferences for the individual household's agents, which is critical to make degeneracy--all households experience the same distribution of meeting outcomes--as an equilibrium; in the second formulation, commitment instead of large is the critical factor.
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- Shouyong Shi, 1997.
"A Divisible Search Model of Fiat Money,"
Econometric Society, vol. 65(1), pages 75-102, January.
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- Shi, Shouyong, 1999. "Search, inflation and capital accumulation," Journal of Monetary Economics, Elsevier, vol. 44(1), pages 81-103, August.
- Shouyong Shi, 1998. "Search, Inflation, and Capital Accumulation," Working Papers 971, Queen's University, Department of Economics.
- Bernhard Rauch, 2000. "A Divisible Search Model of Fiat Money: A Comment," Econometrica, Econometric Society, vol. 68(1), pages 149-156, January.
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