Journal article
Price discriminating monetary policy: A nonuniform pricing approach
Journal of public economics, Vol.35(3), pp.385-392
04/01/1988
DOI: 10.1016/0047-2727(88)90039-4
Abstract
This paper establishes that a version of the Bryant and Wallace (1984) price discrimination analysis of monetary policy can be viewed as a special case of the Spence (1977) nonuniform pricing model. To this end, a general equilibrium model is constructed with heterogeneous agents and a government that faces an informational restriction. The government must finance an exogenously determined, stationary deficit by issuing bonds or currency with quantity-dependent prices. In addition to generalizing the Bryant and Wallace model, the analysis accomplishes the following: (i) the informational restriction helps justify the ruling out of lumpsum taxation (a crucial assumption of the Bryant and Wallace model); and (ii) the analysis provides insight into nonuniform pricing in a simple general equilibrium model with heterogeneous agents.
Details
- Title: Subtitle
- Price discriminating monetary policy: A nonuniform pricing approach
- Creators
- Anne P. Villamil - University of Illinois Urbana-Champaign
- Resource Type
- Journal article
- Publication Details
- Journal of public economics, Vol.35(3), pp.385-392
- Publisher
- Elsevier B.V
- DOI
- 10.1016/0047-2727(88)90039-4
- ISSN
- 0047-2727
- eISSN
- 1879-2316
- Language
- English
- Date published
- 04/01/1988
- Academic Unit
- Economics
- Record Identifier
- 9984380438702771
Metrics
1 Record Views