Active Intermediation in an Monetary Overlapping Generations Economy
This paper establishes that the proï¿½t-seeking activities of private intermediaries can ensure Pareto eï¿½ciency in the standard pure-exchange monetary overlapping generations economy without the need for government monetary or ï¿½scal policy intervention. Moreover, these proï¿½t-seeking activities are shown to rule out all aperiodic and kperiodic cycles for k greater than 2. Contrary to much recent work on intermediation, the proï¿½t opportunities that arise for intermediaries in this context are not due to assumed frictions or asymmetric information. Rather, they are due to the dynamic open-ended structure of the economy, which permits debt roll-over. (C) 1998 Elsevier Science B.V. All rights reserved.
To our knowledge, this item is not available for
download. To find whether it is available, there are three
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
|Date of creation:||01 Jan 1998|
|Date of revision:|
|Publication status:||Published in Journal of Economic Dynamics and Control 1998, vol. 22, pp. 1533-1574|
|Contact details of provider:|| Postal: Iowa State University, Dept. of Economics, 260 Heady Hall, Ames, IA 50011-1070|
Phone: +1 515.294.6741
Fax: +1 515.294.0221
Web page: http://www.econ.iastate.edu
More information through EDIRC
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.:
- Fama, Eugene F., 1985. "What's different about banks?," Journal of Monetary Economics, Elsevier, vol. 15(1), pages 29-39, January.
- Grandmont, Jean-Michel & Laroque, Guy, 1973.
"Money in the pure consumption loan model,"
Journal of Economic Theory,
Elsevier, vol. 6(4), pages 382-395, August.
- Bryant, John, 1981.
"Bank Collapse and Depression,"
Journal of Money, Credit and Banking,
Blackwell Publishing, vol. 13(4), pages 454-64, November.
- Paul A. Samuelson, 1958. "An Exact Consumption-Loan Model of Interest with or without the Social Contrivance of Money," Journal of Political Economy, University of Chicago Press, vol. 66, pages 467.
- Williamson, Stephen D., 1992. "Laissez-faire banking and circulating media of exchange," Journal of Financial Intermediation, Elsevier, vol. 2(2), pages 134-167, June.
- Mark L. Gertler, 1988.
"Financial Structure and Aggregate Economic Activity: An Overview,"
NBER Working Papers
2559, National Bureau of Economic Research, Inc.
- Mark Gertler, 1988. "Financial structure and aggregate economic activity: an overview," Proceedings, Federal Reserve Bank of Cleveland, pages 559-596.
- Gertler, Mark, 1988. "Financial Structure and Aggregate Economic Activity: An Overview," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 20(3), pages 559-88, August.
- Tirole, Jean, 1985. "Asset Bubbles and Overlapping Generations," Econometrica, Econometric Society, vol. 53(6), pages 1499-1528, November.
- Grandmont, Jean-Michel, 1985.
"On Endogenous Competitive Business Cycles,"
Econometric Society, vol. 53(5), pages 995-1045, September.
- David Cass & Menahem E. Yaari, 1965.
"A Re-Examination of the Pure Consumption Loans Model,"
Cowles Foundation Discussion Papers
195, Cowles Foundation for Research in Economics, Yale University.
- David Cass & Menahem E. Yaari, 1966. "A Re-examination of the Pure Consumption Loans Model," Journal of Political Economy, University of Chicago Press, vol. 74, pages 353.
- Gale, David, 1973. "Pure exchange equilibrium of dynamic economic models," Journal of Economic Theory, Elsevier, vol. 6(1), pages 12-36, February.
- Hannan, Timothy H & Berger, Allen N, 1991. "The Rigidity of Prices: Evidence from the Banking Industry," American Economic Review, American Economic Association, vol. 81(4), pages 938-45, September.
- Pingle, Mark & Tesfatsion, Leigh, 1991.
"Overlapping generations, intermediation, and the First Welfare Theorem,"
Journal of Economic Behavior & Organization,
Elsevier, vol. 15(3), pages 325-345, May.
- Pingle, M. & Tesfatsion, Leigh S., 1991. "Overlapping Generations, Intermediation, and the First Welfare Theorem," Staff General Research Papers 11185, Iowa State University, Department of Economics.
- Kane, Edward J, 1989. "The High Cost of Incompletely Funding the FSLIC Shortage of Explicit Capital," Journal of Economic Perspectives, American Economic Association, vol. 3(4), pages 31-47, Fall.
- Balasko, Yves & Shell, Karl, 1980. "The overlapping-generations model, I: The case of pure exchange without money," Journal of Economic Theory, Elsevier, vol. 23(3), pages 281-306, December.
- Balasko, Yves & Shell, Karl, 1981. "The overlapping-generations model. II. The case of pure exchange with money," Journal of Economic Theory, Elsevier, vol. 24(1), pages 112-142, February.
When requesting a correction, please mention this item's handle: RePEc:isu:genres:1227. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Curtis Balmer)
If references are entirely missing, you can add them using this form.