A Strategic Market Game with Seigniorage Costs of Fiay Money
Yale, Cowles Foundation Discussion Paper No. 1043
16 Pages Posted: 15 Jan 2002
There are 2 versions of this paper
A Strategic Market Game with Seigniorage Costs of Fiay Money
Date Written: 2001
Abstract
A model that includes the cost of producing money is presented and the nature of the inefficient equilibria in the model are examined. It is suggested that if one acknowledges that transactions are a form of production, which requires the consumption of resources, then the concept of Pareto optimality is inappropriate for assessing efficiency. Instead it becomes necessary to provide an appropriate comparative analysis of alternative transactions mechanisms in the appropriate context.
Keywords: Strategic market games, seigniorage costs, inefficiency
JEL Classification: D51, E51
Suggested Citation: Suggested Citation
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