This paper generalizes the original random matching model of money by
Kiyotaki and Wright (1989) (KW) in two aspects: first, the economy is
characterized by an arbitrary distribution of agents who specialize in producing a
particular consumption good; and second, these agents have preferences such
that they want to consume any good with some probability. The results
depend crucially on the size of the fraction of producers of each good
and the probability with which different agents want to consume ...
This paper generalizes the original random matching model of money by
Kiyotaki and Wright (1989) (KW) in two aspects: first, the economy is
characterized by an arbitrary distribution of agents who specialize in producing a
particular consumption good; and second, these agents have preferences such
that they want to consume any good with some probability. The results
depend crucially on the size of the fraction of producers of each good
and the probability with which different agents want to consume each
good. KW and other related models are shown to be parameterizations of
this more general one.
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