This study derives the monetary structure of transactions, the use of commodity or fiat money, endogenously from transaction costs in a segmented market general equilibrium model. Market segmentation means there are separate budget constraints for each transaction: Budgets balance in each...

This article presents a game-theoretic model analyzing the strategic competition between hard and fiat money, involving a representative player and a consolidated bank (including the central bank). The findings reveal counterintuitive interactions between inflation, interest rates, and monetary...

In this paper we prove the existence of general equilibrium with transaction costs generalizing Hahn's (Review of Economic Studies, 1973, 40, 449-461) model by introducing producers and nonconvexities (in particular we allow for increasing returns in transaction sets). We also recover any...

In law as well as economics, the most well-known aspect of Coase's “The Problem of Social Cost,” is the Coase Theorem. Over the decades, that particular notion has morphed into a crucial component of Chicago law and economics — namely, transaction cost analysis. In this Article, I...

In the paper, an analytical framework with both increasing returns and transaction costs is developed to investigate the general equilibrium with endogenous specialization and division of labor. In this framework, the impersonal network of the division of labor emerges from the interactions...

We present comprehensive evidence in support of giving liquidity equal standing to size, value/growth, and momentum as investment styles, as defined by Sharpe (1992). First, we show that financial market liquidity, as identified by stock turnover, is an economically significant indicator of...

This paper presents a class of examples where a barter economy develops through agents' optimizing decisions into a monetary economy. A barter economy with m commodities is characterized by m(m-1)/2 commodity pair trading posts for active trade of each good for every other. Monetary equilibrium...

The efficiency of business transactions has become increasingly important in the digital age, and an issue that has arguably evolved as a result of free-markets. Already, advances in technology has revolutionized the medium of exchange from tangible hard-cold cash, to an intangible medium,...