Fisherian Futures Market

The very fact that utility maximization in real business cycle and New Keynesian models is intertemporal suggests the possibility of a Fisherian intertemporal futures market, which is not state-contingent. Ex-ante speaking, the addition of a futures market does not result in any difference, but the addition does make difference ex-post. Furthermore, New Keynesian models rely on nominal effects, and what would introduction of a Fisherian futures market mean for these models? This paper answers this question by presenting a model that features Fisherian intertemporal futures markets.