Cash burns: An inventory model with a cash-credit choice

• 成果类型: Article
• 署名作者: Alvarez, Fernando; Lippi, Francesco
• 署名单位: National Bureau of Economic Research; University of Chicago; University of Sassari
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2017.07.001
• 发表日期: 2017
• 页码: 99-112
• 关键词: Inventory models; Cash-credit choice; Means of payment; Money demand; Phasing out cash

摘要

A dynamic cash-management model is analysed where agents choose whether to pay with cash or credit at every point in time. In the model credit usage depends on the current stock of cash, a novel result that matches recent micro evidence on households' payment choices. The optimality of such a decision rule is novel and cannot be obtained by models where cash-credit decisions are made at the beginning of each period. We discuss how to use the model to account for cross country-evidence on the intensity of credit usage and for several statistics on the size and frequency of cash withdrawals. The model is used to assess the household's welfare cost of phasing out cash. (C) 2017 The Authors. Published by Elsevier B.V.