Unique monetary equilibrium with inflation in a stationary Bewley-Aiyagari model

• 成果类型: Article
• 署名作者: Hu, Tai-Wei; Shmaya, Eran
• 署名单位: University of Bristol; Northwestern University
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2019.01.003
• 发表日期: 2019
• 页码: 368-382
• 关键词: inflation; Saving and consumption; money; uniqueness

摘要

We prove the existence and uniqueness of a stationary monetary equilibrium in a Bewley-Aiyagari model with idiosyncratic shocks. This is an exchange economy with an infinite horizon and one consumption good, and with each agent facing idiosyncratic endowment shocks at each period; the agents may trade their endowments for the only asset, fiat money. The government increases the money supply at a constant growth rate that induces inflation in a stationary monetary equilibrium. We identify the necessary and sufficient condition for a stationary monetary equilibrium (where money has a positive value and the aggregate real balance is constant over time) to exist, and, when it exists, we show that it is unique. The argument for uniqueness is based on a new monotonicity result for the average optimal consumption. (C) 2019 Elsevier Inc. All rights reserved.