We develop a N-sector business cycle network model a la Long and Plosser (1983), featuring heterogenous money demand a la Bewley (1980) and Lucas (1980). Despite incomplete markets and a well-defined distribution of real money balances across heterogeneous households, the enriched N-sector...

The traditional literature treat wage dispersion and firm dynamics, which are closely connected to each other, in isolation. This paper delivers a unified treatment to wage dispersion and firm-size distribution by developing a real-option-theoretic approach. The model is tractable with analytic...