المؤلفون: Zhiping Xie

المصدر: SSRN Electronic Journal.

مصطلحات موضوعية: TheoryofComputation_MISCELLANEOUS, Competition (economics), Microeconomics, symbols.namesake, Matching market, Sequential game, Nash equilibrium, Social cooperation, Fiat money, symbols, Economics, Perfect competition, Monetary economics

الوصف: Kiyotaki-Wright (1991, 1993) ensured fiat money’s essentiality; but they abstract competition away. Therefore, Lagos-Wright (2005) added a frictionless centralized market to their model; however, their method should be improved. This paper directly substitutes perfectly competitive decentralized markets for the randomly matching market to resolve the competition problem. Under a temporary equilibrium framework, it constructs a dynamic game model where agents choose strategies to determine their prediction functions of future nominal prices with respect to past nominal prices. It proves that a combination of the agents’ strategies to fully accept fiat money cooperatively – to avoid tremendous friction – is a Nash Equilibrium.

الوصول الحر: https://explore.openaire.eu/search/publication?articleId=doi_________::d41fefe1187ff86fa05f01c14350b451Test
https://doi.org/10.2139/ssrn.2050751Test

المؤلفون: Zhiping Xie

المصدر: SSRN Electronic Journal.

مصطلحات موضوعية: TheoryofComputation_MISCELLANEOUS, Transaction cost, Endogenous money, General equilibrium theory, Partial equilibrium, Fiat money, TheoryofComputation_GENERAL, Monetary economics, Microeconomics, symbols.namesake, Nash equilibrium, Money illusion, symbols, Economics, Game theory

الوصف: In an infinite-time decentralized sequence economy, agents use fiat money to bridge markets as if they make trades in a centralized economy, to avoid huge transaction cost that all agents’ going together must incur. The model in this paper formulates the process how agents decide the fiat money’s nominal value. Three new concepts are suggested – plan of choices, Temporarily Partial Equilibrium and Intra-Date Equilibrium; and this paper proves the existence of these two equilibriums. Then, based on the equilibrium prices and allocations of the corresponding infinite-time Walrasian economy, this paper proves that all agents’ accepting fiat money with unchanged nominal value is a Nash equilibrium, which guarantees fiat money’s essentiality.

الوصول الحر: https://explore.openaire.eu/search/publication?articleId=doi_________::0cb492d97b1be70673b6b01feb13831eTest
https://doi.org/10.2139/ssrn.1767565Test

المؤلفون: Zhiping Xie

المصدر: SSRN Electronic Journal.

مصطلحات موضوعية: Transaction cost, Microeconomics, General equilibrium theory, media_common.quotation_subject, Economics, Fundamental theorems of welfare economics, Perfect competition, Excess demand function, Welfare, Profit (economics), media_common, Nonlinear programming

الوصف: After taking into account positive transaction costs via tackling static nonlinear programming with dynamic programming, this paper reaches three main conclusions: 1) The aggregate excess demand function of each market will be discontinuous at many price points, but the transfiguration of the graph of aggregate excess demand of each commodity will be continuous with respect to prices of other commodities, and at those price points incurring discontinuity, the corresponding traders' utility or profit will be indifferent between different choices. 2) Via a new approach able to tackle the discontinuous aggregate excess demand, it is proved that, there must exist a market equilibrium price vector in a perfectly competitive economy with positive transaction costs even if each consumer's preference isn't convex. 3) Transaction cost probably spoils the satisfaction of those two fundamental theorems of welfare economics, as well as it ruins the social aggregate welfare through three approaches.

الوصول الحر: https://explore.openaire.eu/search/publication?articleId=doi_________::d651fb448d69198e556bc5cba5165b78Test
https://doi.org/10.2139/ssrn.576801Test

المؤلفون: Zhiping Xie

المصدر: SSRN Electronic Journal.

مصطلحات موضوعية: Transaction cost, education.field_of_study, General equilibrium theory, Population, Social Welfare, Walrasian auction, Supply and demand, Microeconomics, symbols.namesake, Nash equilibrium, symbols, Economics, Fraction (mathematics), education

الوصف: The functional relationships between the price vector and consumer's Marshallian demand and/or producer's optimal actual sale will be directly revealed respectively by two new geometric methods in general equilibrium framework without storage. The impact of transaction cost shared by individual on these functional relationships will be directly analyzed. Then, it is proved that, the demand and supply functions of different commodities will be no longer mathematically continuous, if there is a special kind of transaction cost independent of what are traded, which is mainly caused by information cost. This makes sure that the transaction cost will substantially disturb the Walrasian equilibrium without storage if non-infinitesimal fraction of population synchronously shift their decisions. And then, it is else suggested that transaction cost will dramatically cut down social welfare. Finally, a revised model with storage as a theoretic way out for Walrasian economy of zero-storage will be presented to suggest that a competitive economy with zero-storage probably isn't at Nash equilibrium.

الوصول الحر: https://explore.openaire.eu/search/publication?articleId=doi_________::16c86d16b5ca2a6991016781aa6120e0Test
https://doi.org/10.2139/ssrn.415241Test