Monetary Equilibrium and the Differentiability of the Value Function
In this study we offer a new approach to proving the differentiability of the value function, which complements and extends the literature on dynamic programming. This result is then applied to the analysis of equilibrium in the recent class of monetary economies developed in . For this type of environments we demonstrate that the value function is differentiable and this guarantees that the marginal value of money balances is well defined.
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- Aleksander Berentsen & Gabriele Camera & C hristopher W aller, 2005.
"The Distribution Of Money Balances And The Nonneutrality Of Money,"
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98-03, University of Iowa, Department of Economics.
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"Anonymous Markets and Monetary Trading,"
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"Dynamic monetary equilibrium in a random-matching economy,"
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