ON THE WELFARE EFFECTS OF CREDIT ARRANGEMENTS

• 成果类型: Article
• 署名作者: Chiu, Jonathan; Dong, Mei; Shao, Enchuan
• 署名单位: Bank of Canada; Victoria University Wellington; University of Melbourne; University of Saskatchewan
• 刊物名称: INTERNATIONAL ECONOMIC REVIEW
• ISSN/ISSBN: 0020-6598
• DOI: 10.1111/iere.12315
• 发表日期: 2018
• 页码: 1621-1651
• 关键词: money; equilibrium; banking

摘要

This article studies the welfare effects of credit arrangements and how these effects depend on the trading mechanism and inflation. In a competitive market, credit arrangements can be welfare reducing, because high consumption by credit users drives up the price level, reducing consumption by money users who are subject to a binding liquidity constraint. By adopting an optimal trading mechanism, however, these welfare implications can be overturned. Both price discrimination and nonlinear pricing are essential features of an optimal mechanism.