Output and Price Level Effects of Monetary Uncertainty in a Matching ModelJournal of Economic Theory (2003)
AbstractMonetary uncertainty and information lags are put into a random matching model so that the resulting setting has some meetings in which producers are relatively informed and others in which consumers are relatively informed. For that setting, the ex ante socially optimal way to conduct trade is characterized. The optimum can display a variety of relationships between money and total output and the price level. While the price level is always sticky, even the direction of its response and that of total output depend on the magnitude of the lag and on subtle features of the serial correlation properties of the money supply.
- Price Level,
Publication DateFebruary, 2003
Citation InformationBrett E. Katzman, John Kennan and Neil Wallace. "Output and Price Level Effects of Monetary Uncertainty in a Matching Model" Journal of Economic Theory Vol. 108 Iss. 2 (2003)
Available at: http://works.bepress.com/brett_katzman/12/