Inflation and Unemployment in General Equilibrium (2007)
Rocheteau, Guillaume, Rupert, Peter, Wright, Randall
When labor is indivisible, there exist efficient outcomes with some agents randomly unemployed (Rogerson 1988). We integrate this idea into the modern theory of monetary exchange, where some trade...
Equilibrium Wage Dispersion: An Example (2006)
Gaumont, Damien, Schindler, Martin, Wright, Randall
Search models with wage posting and match-specific heterogeneity generate wage dispersion. Given K values for the match-specific variable, it is known that there are K reservation wages that could be...
Equilibrium Wage Dispersion: An Example (2006)
Gaumont, Damien, Schindler, Martin, Wright, Randall
Search models with wage posting and match-specific heterogeneity generate wage dispersion. Given K values for the match-specific variable, it is known that there are K reservation wages that could be...
Equilibrium Wage Dispersion: An Example (2006)
Gaumont, Damien, Schindler, Martin, Wright, Randall
Search models with wage posting and match-specific heterogeneity generate wage dispersion. Given K values for the match-specific variable, it is known that there are K reservation wages that could be...
Search, Money, and Capital: A Neoclassical Dichotomy (2004)
Aruoba, S. Boragan., Wright, Randall.
Journal of Money, Credit, and Banking - Volume 35, Number 6 (Part 2), December 2003
Burdett, Kenneth, Imai, Ryoichi, Wright, Randall
We analyze models where agents search for partners to form relationships (employment, marriage, etc.), and may or may not continue searching for different partners while matched. Matched agents are...
Burdett, Kenneth, Imai, Ryoichi, Wright, Randall
We analyze models where agents search for partners to form relationships (employment, marriage, etc.), and may or may not continue searching for different partners while matched. Matched agents are...
Burdett, Kenneth, Imai, Ryoichi, Wright, Randall
We analyze models where agents search for partners to form relationships (employment, marriage, etc.), and may or may not continue searching for different partners while matched. Matched agents are...
A Unified Framework for Monetary Theory and Policy Analysis (2003)
Lagos, Ricardo, Wright, Randall
Search-theoretic models of monetary exchange are based on explicit descriptions of the frictions that make money essential. However, tractable versions of these models typically need strong...
Putting Home Economics into Macroeconomics (2001)
Jeremy Greenwood, Richard Rogerson, Randall Wright
This paper surveys the role of household production in modern business cycle analysis.
Wright, Randall, Trejos, Alberto
We develop a two-country, two-currency, search-theoretic model of monetary exchange, extending previous such models by endogenizing prices using bargaining theory. We analyze features of the...
Wright, Randall, Trejos, Alberto
We develop a two-country, two-currency, search-theoretic model of monetary exchange, extending previous such models by endogenizing prices using bargaining theory. We analyze features of the...
Wright, Randall, Trejos, Alberto
We develop a two-country, two-currency, search-theoretic model of monetary exchange, extending previous such models by endogenizing prices using bargaining theory. We analyze features of the...
A Model of Commodity Money, With Applications to Gresham's Law and the Debasement Puzzle (2001)
Francois R. Velde, Warren E. Weber, Randall Wright
We develop a model of commodity money and use it to analyze the following two questions motivated by issues in monetary history: What are the conditions under which Gresham's Law holds? And, what are...
Dean Corbae, Ted Temzelides, Randall Wright
We analyze matching models of monetary exchange where agents get to choose endogenously the individuals (or at least the types of individuals) that they meet, rather than having agents matched...
Typescript (photocopy)
Equilibrium Wage Dispersion: An Example
Damien Gaumont, Randall Wright, Martin Schindler
Search models with posting and match-specific heterogeneity generate wage dispersion. Given K values for the match-specific variable, it is known that there are K reservation wages that could be...
The labor market in real business cycle theory
Gary D. Hansen, Randall Wright
The standard real business cycle model fails to adequately account for two facts found in the U.S. data: the fact that hours worked fluctuate considerably more than productivity and the fact that the...
A contribution to the pure theory of money
Nobuhiro Kiyotaki, Randall Wright
We analyze a general equilibrium model with search frictions and differentiated commodities. Because of the many differentiated commodities, barter is difficult because it requires a double...
A note on labor contracts with private information and household production
Ed Nosal, Richard Rogerson, Randall Wright
A classic result in the theory of implicit contract models with asymmetric information is that “underemployment” results if and only if leisure is an inferior good. We introduce household...
Indivisibilities, lotteries, and sunspot equilibria
We analyze economies with indivisible commodities. There are two reasons for doing so. First, we extend and provide new insights into sunspot equilibrium theory. Finite competitive economies with...
A discussion of Cooley and Hansen's "welfare costs of moderate inflations."
This is a note on the analysis of inflation and taxation in Cooley and Hansen’s cash-in-advance economy described in their paper “The Welfare Costs of Moderate Inflations.” Basic issues...
Homework in macroeconomics: household production and aggregate fluctuations
Jess Benhabib, Richard Rogerson, Randall Wright
This paper explores some macroeconomic implications of including household production in an otherwise standard real business cycle model. We calibrate the model based on microeconomic evidence and...
Why is automobile insurance in Philadelphia so damn expensive?
We document and attempt to explain the observation that automobile insurance premiums vary dramatically across local markets. We argue high premiums can be attributed to the large numbers of...
More on money as a medium of exchange
Timothy J. Kehoe, Nobuhiro Kiyotaki, Randall Wright
We extend the analysis of Kiyotaki and Wright, who study an economy in which the different commodities that serve as media of exchange are determined endogenously. Kiyotaki and Wright consider only...
Barter and monetary exchange under private information
Steve Williamson, Randall Wright
We analyze economies with private information concerning the quality of commodities. Without private information there is a nonmonetary equilibrium with only high quality commodities produced, and...
Household production and taxation in the stochastic growth model
Ellen McGrattan, Richard Rogerson, Randall Wright
We estimate a dynamic general equilibrium model of the U.S. economy that includes an explicit household production sector. We use these estimates to investigate two issues. First, we analyze how well...
Kenneth Burdett, Randall Wright
We integrate search theory into an equilibrium framework in a new way and argue that the result is a simple but powerful tool for understanding many issues related to bilateral matching. We assume...
The goal of this paper is to extend the analysis of strategic bargaining to nonstationary environments, where preferences or opportunities may be changing over time. We are mainly interested in...
Estimating substitution elasticities in household production models
Peter Rupert, Richard Rogerson, Randall Wright
Dynamic general equilibrium models that include explicit household production sectors provide a useful framework within which to analyze a variety of macroeconomic issues. However, some implications...
An equilibrium model of the business cycle with household production and fiscal policy
Ellen McGrattan, Richard Rogerson, Randall Wright
We estimate a dynamic general equilibrium model of the U.S. economy that includes an explicit household production sector and stochastic fiscal variables. We use our estimates to investigate two...
A model of commodity money, with applications to Gresham's law and the debasement puzzle
Francois R. Velde, Warren E. Weber, Randall Wright
We develop a model of commodity money and use it to analyze the following two questions motivated by issues in monetary history: What are the conditions under which Gresham's Law holds? And, what are...
Crime, Inequality, and Unemployment, Second Version
Kenneth Burdett, Ricardo Lagos, Randall Wright
There is much discussion of the relationships between crime, inequality, and unemployment. We construct a model where all three are endogenous. We find that introducing crime into otherwise standard...
An On-the-Job Search Model of Crime, Inequality, and Unemployment
Kenneth Burdett, Ricardo Lagos, Randall Wright
We extend simple search-theoretic models of crime, unemployment and inequality to incorporate on-the-job search. This is valuable because, although the simple models can be used to illustrate some...
Money in Search Equilibrium, in Competitive Equilibrium, and in Competitive Search Equilibrium
Guillaume Rocheteau, Randall Wright
We compare three pricing mechanisms for monetary economies: bargaining (search equilibrium); price taking (competitive equilibrium); and price posting (competitive search equilibrium). We do this in...
Inflation and Welfare in Models with Trading Frictions
Guillaume Rocheteau, Randall Wright
We study the effects of inflation in models with various trading frictions. The framework is related to recent search-based monetary theory, in that trade takes place periodically in centralized and...
Alternative Theories of Wage Dispersion
Damien Gaumont, Martin Schindler, Randall Wright
We analyze labor market models where the law of one price does not hold; i.e., models with equilibrium wage dispersion. We begin assuming workers are ex ante heterogeneous, and highlight a flaw with...
Search, Money and Capital: A Neoclassical Dichotomy, Second Version
S. Boragan Aruoba, Randall Wright
Recent work has reduced the gap between search-based monetary theory and mainstream macroeconomics by incorporating into the search model some centralized markets as well as some decentralized...
Search, Bargaining, Money, and Prices.
Trejos, Alberto, Wright, Randall
This goal of this paper is to extend existing search-theoretic models of fiat money, which until now have assumed that the price level is exogenous, by explicitly incorporating bilateral bargaining....
Alternative Models of Wage Dispersion
Damien Gaumont, Randall Wright, Martin Schindler
We analyze labor market models where the law of one price does not hold-that is, models with equilibrium wage dispersion. We begin by assuming workers are ex ante heterogeneous, and highlight a flaw...
Homework in Development Economics: Household Production and the Wealth of Nations
Stephen L. Parente, Richard Rogerson, Randall Wright
We introduce home production into the neoclassical growth model and examine its consequences for development economics. In particular, we study the extent to which one can account for international...
Pricing and Matching with Frictions
Kenneth Burdett, Shouyong Shi, Randall Wright
Suppose that n buyers each want one unit and m sellers each have one or more units of a good. Sellers post prices, and then buyers choose sellers. In symmetric equilibrium, similar sellers all post...
The labor market implications of unemployment insurance and short-term compensation
Two types of unemployment insurance systems are studied. In one, unemployed workers receive benefits while those on reduced hours do not, as in North America (at least until recently). In the other,...
The labor market in real business cycle theory
Gary D. Hansen, Randall Wright
The standard real business cycle model fails to adequately account for two facts found in the U.S. data: the fact that hours worked fluctuate considerably more than productivity and the fact that the...
Acceptability, means of payment, and media of exchange
Nobuhiro Kiyotake, Randall Wright
This essay explains the use of fiat money, or why intrinsically useless objects are accepted as payment in transactions. People accept a particular object as a means of payment because others do:...
Putting home economics into macroeconomics
Jeremy Greenwood, Richard Rogerson, Randall Wright
The implications of adding household production to an otherwise standard real business cycle model are explored in this article. The model developed treats the business and household sectors...
Introduction to ?Models of Monetary Economies II: The Next Generation?
This article is a summary of the papers presented at the Models of Monetary Economies II conference, hosted in May 2004 by the Federal Reserve Bank of Minneapolis and the University of Minnesota. It...
Inflation and Unemployment: Lagos-Wright meets Mortensen-Pissarides
Aleksander Berentsen, Guido Menzio, Randall Wright
Inflation and unemployment are central issues in macroeconomics. While progress has been made on these issues recently using models that explicitly incorporate search-type frictions, existing models...
Inflation and Unemployment in General Equilibrium
Guillaume Rocheteau, Peter Rupert, Randall Wright
When labor is indivisible, there exist efficient outcomes with some agents randomly unemployed (Rogerson 1988). We integrate this idea into the modern theory of monetary exchange, where some trade...
Inflation and Unemployment in the Long Run
Aleksander Berentsen, Guido Menzio, Randall Wright
We study the long-run relation between money, measured by inflation or interest rates, and unemployment. We first discuss data, documenting a strong positive relation between the variables at low...
Money in Search Equilibrium, in Competitive Equilibrium, and in Competitive Search Equilibrium
Guillaume Rocheteau, Randall Wright
We compare three market structures for monetary economies: bargaining (search equilibrium); price taking (competitive equilibrium); and price posting (competitive search equilibrium). We also extend...
Barter and Monetary Exchange under Private Information.
Williamson, Steve, Wright, Randall
The authors develop a model of production and exchange with uncertainty concerning the quality of commodities and study the role of fiat money in ameliorating frictions caused by private information....
Search-Theoretic Models of the Labor Market: A Survey
Richard Rogerson, Robert Shimer, Randall Wright
We survey the literature on search-theoretic models of the labor market. We show how this approach addresses many issues, including the following: Why do workers sometimes choose to remain...
Household production and development
Stephen L. Parente, Richard Rogerson, Randall Wright
The authors introduce home production into the neoclassical growth model and examine its consequences for development economics. They focus on how well differences in policies that distort capital...
The search-theoretic approach to monetary economics: a primer
Peter Rupert, Martin Schindler, Andrei Shevchenko, Randall Wright
The authors present simple versions of models used in the search-theoretic approach to monetary economics. They discuss results on the existence of monetary equilibria, the potential for multiple...
MONEY AND BANKING IN SEARCH EQUILIBRIUM
Ping He, Lixin Huang, Randall Wright
We develop a new theory of money and banking based on the old story in which goldsmiths start accepting deposits for safe keeping, then their liabilities begin circulating as media of exchange, then...
AN ON-THE-JOB SEARCH MODEL OF CRIME, INEQUALITY, AND UNEMPLOYMENT
Kenneth Burdett, Ricardo Lagos, Randall Wright
We extend simple search models of crime, unemployment, and inequality to incorporate on-the-job search. This is valuable because, although simple models are useful, on-the-job search models are more...
Competitive Pricing and Efficiency in Search Equilibrium
Dale T. Mortensen, Randall Wright
We consolidate and generalize some results on price determination and efficiency in search equilibrium. Extending models by Rubinstein and Wolinsky and by Gale, heterogeneous buyers and sellers meet...
An Equilibrium Model of the Business Cycle with Household Production and Fiscal Policy.
McGrattan, Ellen R, Rogerson, Richard, Wright, Randall
The authors estimate a dynamic general equilibrium model of the U.S. economy that includes an explicit household production sector and stochastic fiscal variables. They use their estimates to...
MONEY AS A MEDIUM OF EXCHANGE WHEN GOODS VARY BY SUPPLY AND DEMAND
CUADRAS-MORAT , XAVIER, WRIGHT, RANDALL
Models of the exchange process based on search theory can be used toanalyze the features of objects that make them more or less likely toemerge as money in equilibrium. These models illustrate...
Money as a Medium of Exchange When Goods Vary by Supply and Demand.
Cuadras-Morato, Xavier, Wright, Randall
Models of the exchange process based on search theory can be used to analyze the features of objects that make them more or less likely to emerge as money in equilibrium. These models illustrate the...
Search, Bargaining, Money and Prices: Recent Results and Policy Implications.
Trejos, Alberto, Wright, Randall
Recently, the search-theoretic approach to monetary economics has been generalized to incorporate bilateral bargaining theory in order to determine the purchasing power of money endogenously (the...
Inflation and Unemployment in General Equilibrium
Guillaume Rocheteau, Peter Rupert, Randall Wright
When labor is indivisible, there exist efficient outcomes with some agents randomly unemployed, as in Rogerson (1988). We integrate this idea into the modern theory of monetary exchange, where some...
A Model of Money and Credit, with Application to the Credit Card Debt Puzzle
IRINA A TELYUKOVA, RANDALL WRIGHT
Many individuals simultaneously have significant credit card debt and money in the bank. The "credit card debt puzzle "is as follows: given high interest rates on credit cards and low rates on bank...
Two-Sided Search with Nontransferable Utility
We analyze a two-sided search model in which we assume utility is not perfectly transferable. Except for this assumption the model is standard, yet it generates results that are quite different from...
A Model of Commodity Money, with Applications to Gresham's Law and the Debasement Puzzle
François R. Velde, Warren E. Weber, Randall Wright
What are the conditions under which Gresham's Law holds? And what are the mechanics of a debasement? To analyze these questions, we develop a model of commodity money with light and heavy coins,...
S. Boragan Aruoba, Christopher J. Waller, Randall Wright
We revisit classic questions concerning the effects of money on investment in a new framework: a two-sector model where some trade occurs in centralized and some in decentralized markets, as in...
A model of money and credit, with application to the credit card debt puzzle
Irina A. Telyukova, Randall Wright
Many individuals simultaneously have significant credit card debt and money in the bank. The credit card debt puzzle is: given high interest rates on credit cards and low rates on bank accounts, why...
The 2007 Summer Workshop on Money, Banking and Payments: an overview
The 2007 Summer Workshop on Money, Banking, Payments and Finance met at the Federal Reserve Bank of Cleveland this summer, as we have over the past several years. The following document summarizes...
AN INTERVIEW WITH PETER DIAMOND
Moscarini, Giuseppe, Wright, Randall
Peter Diamond is one of the major contributors to economics during the last half century. His many contributions include research on growth, Social Security, public finance more generally, the...
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