International Finance Discussion Papers (IFDP)
May 1988
Money, Interest, and Capital in a Cash-In-Advance Economy
Wilbur John Coleman II
Abstract:
A cash-in-advance constraint on consumption is incorporated into a standard model of consumption and capital accumulation. Monetary policy consists of lump-sum cash transfers. Methods are developed for establishing the existence and uniqueness of an equilibrium. and for explicitly constructing this equilibrium. The model economy's dependence on monetary policy is explored.
PDF: Full Paper
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