Optimal inflation in a model of inside money

B-Tier
Journal: Review of Economic Dynamics
Year: 2014
Volume: 17
Issue: 2
Pages: 287-293

Authors (2)

Alexei Deviatov (not in RePEc) Neil Wallace (Pennsylvania State University)

Score contribution per author:

1.005 = (α=2.01 / 2 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

There are several models of outside money in which some inflation accomplished through lump-sum transfers is optimal. It is shown here that inflation can be optimal in a model of inside money, essentially the model in Cavalcanti-Wallace (1999). The possibility of inflation comes about via the trades between people who can issue inside money, monitored people, and those who cannot, nonmonitored people. Inflation occurs at the optimum if the monitored people spend more in such meetings when they are buyers than they receive in such meetings when they are sellers. (Copyright: Elsevier)

Technical Details

RePEc Handle
repec:red:issued:12-132
Journal Field
Macro
Author Count
2
Added to Database
2026-01-25