A Strategic Market Game with Seigniorage Costs of Fiay Money

Yale, Cowles Foundation Discussion Paper No. 1043

16 Pages Posted: 15 Jan 2002

See all articles by Martin Shubik

Martin Shubik

Yale University - School of Management; Yale University - Cowles Foundation

Dimitrios P. Tsomocos

University of Oxford - Said Business School and St. Edmund Hall

Multiple version iconThere are 2 versions of this paper

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

Shubik, Martin and Tsomocos, Dimitrios P., A Strategic Market Game with Seigniorage Costs of Fiay Money (2001). Yale, Cowles Foundation Discussion Paper No. 1043, Available at SSRN: https://ssrn.com/abstract=296852 or http://dx.doi.org/10.2139/ssrn.296852

Martin Shubik

Yale University - School of Management ( email )

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Dimitrios P. Tsomocos (Contact Author)

University of Oxford - Said Business School and St. Edmund Hall ( email )

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