Search,Network Effects and Evolution of Money

Search,Network Effects and Evolution of Money


Author:Pang Xiaobo,Huang Weiting Journal:Nankai Economic Studies  Date:2008(5)

Keywords Search and Matching;Net work Effects;Cost Effects;Learning;Evolution of Money

Abstract

Based on Mengerian theory of money,we built a simple dynamic model of money origin.We employed the search behavior of agents and the matching technology in our model;found that good to be money must consist with two attributes:low storage cost and high net work effects.We also concluded the effects of cost attribute on the evolution of money by studying the adaptive behavior of agents,and approved the existence of the fundamental equilibrium and speculative equilibrium in the neoclassical monetary theory.In the end of this paper,we gave out some applied cases of our model.

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