The ...rst setup we study is a deterministic model with spatial separation where we consider alternative payments systems institutions and their implications for allocation and welfare. A payments system with period-by-period settlement in outside money improves on decentralized exchange. An e¢cient allocation is supported by a payments system where settlement is not imposed. In the second mode...

I put forward a new theoretical framework to analyze the relationship between soft budget constraint syndrome and the economic performances of firms. It differs from the existing theoretical framework, à la Dewatripont and Maskin (1995), in the soft budget constraint literature. In this paper, soft budget constraint syndrome arises when firms that are expected to lose money are financed. The pa...

What makes money essential for the functioning of modern society? Through an experiment, we present evidence for the existence of a relevant behavioral dimension in addition to the standard theoretical arguments. Subjects faced repeated opportunities to help an anonymous counterpart who changed over time. Cooperation required trusting that help given to a stranger today would be returned by a s...

variation of frequency and voltage by load changes in a microgrid is a challenge in droop control method. centralized restoration frequency or voltage in a microgrid requires communication link and therefore affects the advantage of decentralized droop control such as reliability, simplicity and inexpensiveness. this paper proposes a decentralized method that restores the frequency of a microgr...

Views stated in Policy Discussion Papers are those of the authors and not necessarily those of the Federal Reserve Bank of Cleveland or of the Board of Governors of the Federal Reserve System. Materials may be reprinted, provided that the source is credited. Please send copies of reprinted materials to the editor. In this paper we provide a survey of the payment literature in a unifi ed framewo...

We offer an account of China’s unparalleled economic rise by considering evidence on public banks and their role in decentralizing the resource allocation task a growing economy. Chinese banking history since post-Mao reforms reveals ingenious integration local policymakers Currency (public money supply) Banking School (decentralized creation) policy recommendations previously thought incompati...

Real effects of long-run inflation are studied in a standard matching model money. Depending on the underlying policy, can increase output but decrease ex ante social welfare or do opposite. Inflation makes distribution wealth more concentrated at very top. When facing potential policy change, poor much sensitive to which may be adopted than rich. Decentralized trade plays critical role these f...

Background Bitcoin, a peer-to-peer electronic currency, is a distributed ledger system (Nakamoto 2009). Every transaction is broadcast and verified by all nodes in the network through a particular consensus mechanism (Bonneau et al. 2015; Yermack 2013). Every node collects transactions in a block and the block is associated with a difficult mathematical problem. Solving that problem is called m...

One of the current trends in computer science leads to the design of computing organizations based on the activity of a multitude of tiny cheap decentralized computing entities. Whether these chips are integrated into paintings or disseminated in open environments like dust, the fundamental problem lies in their cooperative operation so that global functions are obtained collectively. In this p...