Michael Choi, UC Irvine - April 25, 2019
Michael Choi, UC Irvine will present a seminar at 4:00 PM in Arts 807
April 25, 2019
Michael Choi, UC Irvine will present a seminar at 4:00 PM in Arts 807
Seminar Title: Money Mining and Price Dynamics (Joint with Guillaume Rocheteau)
Abstract:
We develop a random-matching model to study the price dynamics of monies produced privately according to a time-consuming mining technology. There exists a unique equilibrium where the value of money reaches a steady state but a continuum of perfect-foresight equilibria indexed by the starting value of the currency where the price of money inflates and bursts. In the aftermath of its introduction, private money is held for a speculative motive and it acquires a transactional role when it becomes sufficiently abundant. We study divisible, indivisible, flat and commodity monies, and adopt implementation and equilibrium approaches.