Bargains, Barter, and Money

Merwan Engineer; Shouyong Shi

doi:10.1006/redy.2000.0107

Bargains, Barter, and Money

Merwan Engineer, Shouyong Shi

Economics

Research output: Contribution to journal › Article

10 Scopus citations

Abstract

We examine a search money model in which there is a symmetric coincidence of wants in all barter matches. However, when bargaining outcomes are asymmetric across matches, the barter economy is inefficient. Then a robust monetary equilibrium exists provided that money holders enjoy adequate bargaining terms. Fiat money may be welfare improving. In contrast to the literature, it is the asymmetry in bargains across matches rather than asymmetry in demands that generates these results. Journal of Economic Literature Classification Numbers: C78, E40.

Original language	English (US)
Pages (from-to)	188-209
Number of pages	22
Journal	Review of Economic Dynamics
Volume	4
Issue number	1
DOIs	https://doi.org/10.1006/redy.2000.0107
Publication status	Published - Jan 1 2001

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All Science Journal Classification (ASJC) codes

Economics and Econometrics

Cite this

Engineer, M., & Shi, S. (2001). Bargains, Barter, and Money. Review of Economic Dynamics, 4(1), 188-209. https://doi.org/10.1006/redy.2000.0107

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Access to Document

10.1006/redy.2000.0107