Intermediaries and payments instruments

• 成果类型: Article
• 署名作者: Bullard, J; Smith, BD
• 署名单位: Federal Reserve System - USA; Federal Reserve Bank - St. Louis; University of Texas System; University of Texas Austin
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/S0022-0531(03)00013-9
• 发表日期: 2003
• 页码: 172-197
• 关键词: Private money; banknotes; intermediation; Monetary theory; endogenous volatility

摘要

We study an economy in which intermediaries have incentives to issue circulating liabilities as part of an equilibrium. We show that, with arbitrarily small transactions costs, only the liabilities of intermediaries will circulate, and not those of other private sector agents. Therefore, our model connects intermediation activity with the issuance of payments media, a connection that has not been made in earlier literature. We use our model to suggest a resolution of the banknote underissue puzzle of Cagan (in: D. Carson (Ed.), Banking and Monetary Studies, Richard D. Irwin Publishing, Homewood, IL, 1963). (C) 2003 Elsevier Science (USA). All rights reserved.