Guillaume Rocheteau

We study an over-the-counter (OTC) market with bilateral meetings and bargaining where the usefulness of assets, as means of payment or collateral, is limited by the threat of fraudulent practices.

I apply mechanism design to quantify the cost of inflation that can be attributed to monetary frictions alone.

This paper adopts mechanism design to tackle the central issue in monetary theory, namely, the coexistence of money and higher-return assets.

We review the literature on asset markets with trading frictions in both finance and monetary theory using a simple search-theoretic model, and we discuss the papers presented at the conference, "Liquidity in Frictional Asset Markets."

We study economies with an essential role for liquid assets in transactions. The model can generate multiple stationary equilibria, across which asset prices, market participation, capitalization, output, and welfare are positively related.

I extend and discuss the model of asset liquidity by Lester, Postlewaite, and Wright (2007, 2008).

This paper offers a monetary theory of asset liquidity and it explores the implications of the theory for the relationship between assets’ intrinsic characteristics and liquidity, and the effects of monetary policy on asset prices and welfare.

We study counterfeiting of currency in a search–theoretic model of monetary exchange.

We develop a search-theoretic model of financial intermediation and use it to study how trading frictions affect the distribution of asset holdings, asset prices, efficiency, and standard measures of liquidity.

I study random-matching economies where fiat money coexists with real assets, and no restrictions are imposed on payment arrangements.

We review the positive and normative effects of a minimum wage in various versions of a search-theoretic model of the labor market.

We describe counterfeiting activity as the issuance of private money, one which is difficult to monitor.

This paper extends the Pissarides (2000) model of the labor market to include crime and punishment à la Becker (1968).

We study the dynamics of liquidity provision by dealers during an asset market crash, described as a temporary negative shock to investors’ aggregate asset demand.

We study how trading frictions in asset markets affect the distribution of asset holdings, asset prices, efficiency, and standard measures of liquidity.

This paper investigates how market structure affects efficiency and several dimensions of liquidity in an asset market.

We construct a model in which capital competes with fiat money as a medium of exchange, and establish conditions on fundamentals under which fiat money can be both valued and socially beneficial.

We investigate how trading frictions in asset markets affect portfolio choices, asset prices, and efficiency.

We study general equilibrium with nonconvexities. In these economies there exist sunspot equilibria without the usual assumptions needed in convex economies, and they have good welfare properties.

This paper develops a model of currency circulation under asymmetric information.

This paper investigates the welfare effects of inflation in economies with search frictions and menu costs.

Search models of monetary exchange have typically relied on Nash (1950) bargaining or strategic games that yield an equivalent outcome to determine the terms of trade.

In this paper the authors study the inefficiencies of the monetary equilibrium and optimal monetary policies in a search economy.

This paper studies the effects of anticipated inflation on aggregate output and welfare within a search-theoretic framework.

We compare three market structures for monetary economies: bargaining (search equilibrium); price taking (competitive equilibrium); and price posting (competitive search equilibrium).

Can two countries, or twodifferent states, with similartechnologies, resources, andpolicies exhibit differences inlabor market performance?

New models of employment show that there are some cases in which a minimum wage can have positive effects on employment and social welfare.

Modern economists have built models of the labor market, which isolate the market’s key drivers and describe the way these interact to produce particular levels of unemployment.

Gresham’s law, which says that bad money tends to drive good money out of circulation, may account for many nations’ episodes of money troubles, as far back as ancient Athens.

New models of monetary economies,developed in the last 15 years, suggestthat traditional measures of the welfarecost of inflation may underestimatethe true loss that inflation inflictson society.

The United States has introduced two one-dollar coins in the past 25 years, both of which have not circulated widely. Many other countries have replaced lower-denomination notes with coins and have achieved wide circulation and cost savings. Lessons from those countries suggest that achieving widespread use of a dollar coin is much harder if the note is allowed to remain in circulation.

This Policy Discussion Paper summarizes the papers that were presented at the Liquidity in Frictional Markets conference in November 2008.

This paper extends recent findings in the search-theoretic literature on monetary exchange regarding the welfare costs of inflation.