On the coexistence of money and higher-return assets and its social role

• 成果类型: Article
• 署名作者: Hu, Tai-Wei; Rocheteau, Guillaume
• 署名单位: Northwestern University; University of California System; University of California Irvine; Universite Paris-Pantheon-Assas
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2013.09.006
• 发表日期: 2013
• 页码: 2520-2560
• 关键词: money; Capital; Pairwise trades; Rate-of-return dominance

摘要

This paper adopts mechanism design to investigate the coexistence of fiat money and higher-return assets. We consider an economy with pairwise meetings where fiat money and risk-free capital compete as means of payment, as in [28]. The trading mechanism in pairwise meetings is chosen among all individually rational, renegotiation-proof mechanisms to maximize society's welfare. We show that in any stationary monetary equilibrium capital commands a higher rate of return than fiat money. (C) 2013 Elsevier Inc. All rights reserved.