Government Finance in a Model of Currency Substitution »
Journal Issue
Volume/Issue: 1993/80
Series: IMF Working Papers
Author(s): Lihong Liu , and Anne Sibert
Publisher: INTERNATIONAL MONETARY FUND
Publication Date: 01 October 1993
DOI: http://dx.doi.org/10.5089/9781451955477.001
ISBN: 9781451955477
Keywords: money growth, inflation, money demand, monetary policy, monetary fund
Our model is a variant of the cash-in-advance model. Goods must be purchased in the seller’s currency, but currency may be traded before shopping at a cost. This cost is a measure of substitutability. The mo...