Milton Friedman, the Demand for Money and the ECB’s Monetary-Policy Strategy

I model a single-club economy with heterogeneous consumers as an aggregative game. I give a sufficient condition, normality of demand for the club good in full income, for the existence and uniqueness of a Nash equilbrium by the Cornes-Hartley (2007) method. Then, confining attention to club quality functions that are homogeneous in the investment in the club facility and the aggregate usage of the club, I examine when the sufficient condition is satisfied. I show that, under common assumptions on the utility function, this occurs for all positive degrees of homogeneity.