sance writings, from scholars like Hostiensis (ca.1200–71), Oresme (1320–82) and Copernicus (1473–1543), and from mint officials like Henri Poullain (1612). As we have just seen, Aristophanes, in the 5th century B.C.E., had already anticipated the mechanism. And it was the British economist, Stanley Jevons, who originated the expression “bad money drives out good money” in his 1875 book, Money ...

A model is developed that employs recent developments in the literature on search models of money to capture the distributional effects of monetary policy in a tractable way. Deterministic and stochastic versions of the model are studied. Money is not neutral, and these nonneutralities persist, whether or not the change in the money supply is anticipated or unanticipated. At the optimum, moneta...

The present paper analyses the relations between food and oil prices for Malaysia using a nonlinear autoregressive distributed lags (NARDL) model. The bounds test of the NARDL specification suggests the presence of cointegration among the variables, which include the food price, oil price and real GDP. The estimated NARDL model affirms the presence of asymmetries in the food price behavior. Nam...

based on the “aggregate demand” theory, monetary policies are designed with the aim of achieving desirable level of macroeconomic goals through affecting the stock of money supplyand income velocity of money. thus, the velocity (v)-as well as money supply - has significant impact, particularly on rate of inflation through expansionary or contractionary monetary policy. to focus on the velocity ...

Billions of dollars worth of shares are traded in the stock market on a daily basis. Many people depend on the stock market as their primary source of income while others have their retirement funds tied to the stock market. The importance of “good” performance of the stock market is obvious. History has shown that a downturn in stock prices can cause major disturbances in the lives of many. Al...

Recently, in order to explore the mechanism behind wealth or income distribution, several models have been proposed by applying principles of statistical mechanics. These models share some characteristics, such as consisting of a group of individual agents, a pile of money and a specific trading rule. Whatever the trading rule is, the most noteworthy fact is that money is always transferred fro...

Based on the “Aggregate Demand” theory, monetary policies are designed with the aim of achieving desirable level of macroeconomic goals through affecting the stock of money supplyand income velocity of money. Thus, the velocity (V)-as well as money supply - has significant impact, particularly on rate of inflation through expansionary or contractionary monetary policy. To focus on the velocity ...

This paper proposes a general equilibrium model that aims at quantifying the distributive effects of anticipated inflation in an incomplete market economy with heterogeneous agents. Based on empirical evidence, this paper assumes a fixed cost to participate in financial markets, which in equilibrium generates a theory of money. Money is a return dominated asset, but also a costless mean to smoo...

Money illusion means that people behave differently when the same objective situation is represented in nominal terms rather than in real terms. This paper shows that seemingly innocuous differences in payoff representation cause pronounced differences in nominal price inertia indicating the behavioral importance of money illusion. In particular, if the payoff information is presented to subjec...

This paper analyzes the dynamic effects of anticipated and unanticipated foreign price increases of imported raw materials for a small two-country monetary union, which is simultaneously characterized by asymmetric wage adjustments and asymmetric interest rate sensitivities of private absorption. It is shown that both types of input price disturbances lead to temporary divergences in output dev...