Modeling Monetary Economies

For advanced monetary economics and money and banking courses. A first principles approach with increased cryptocurrency coverage.

Bruce Champ (Author), Scott Freeman (Author), Joseph H. Haslag (Author)

9781316515211, Cambridge University Press

Hardback, published 2 June 2022

475 pages
26.2 x 18.4 x 2.8 cm, 0.961 kg

'The textbook Modeling Monetary Economies provides a rigorous treatment of money, banking, and financial intermediation within a unified framework that is accessible to advanced undergraduate students. It addresses the most fundamental questions in monetary theory - e.g., Can fiat money be valued in equilibrium? Can it coexist with interest-bearing assets? Why do banks exist? - without shortcuts. It also covers material that is relevant for today's problems, including cryptocurrencies and blockchain technologies, the design of payment systems, bank regulations, the welfare costs of inflation … It is a must-read for all students interested in monetary issues.' Guillaume Rocheteau, University of California, Irvine

Thoroughly updated and expanded with a new chapter on blockchain and increased coverage of cryptocurrency, as well as new data, this established advanced undergraduate textbook approaches the subject via first principles. It builds on a simple, clear monetary model and applies this framework consistently to a variety of monetary questions. Starting with trade being mutually beneficial, the authors demonstrate that money makes people better off, and that government money competes against other means of payments, including other types of government payments. After developing each of these topics, the book tackles the issue of money competing against other stores of value, examining issues associated with trade, finance, and modern banking. From simple economies to modern economies, the authors address the role banks play in making more trade possible, concluding with the information problems plaguing modern banking.

List of figures
List of tables
Preface
Part I. Money
1. The economy and the planner's solution
2. Equilibrium trade in the economy without money
3. A simple model of money
4. Barter and commodity money
5. Inflation
6. International monetary systems
7. Price surprises
Part II. Capital and Banking
8. Capital
9. Liquidity and financial intermediation
10. Central banking and the money supply
11. Money stock fluctuations
12. Fully backed central bank money
13. Payment systems
14. Bank risk
15. Liquidity risk and bank panics
Part III. Government Policy
16. De?cits and the national debt
17. Savings and investment
18. The effect of the national debt on capital and savings
19. The temptation of in?ation
References
Index.

Subject Areas: Public finance [KFFD], Political economy [KCP], International economics [KCL], Monetary economics [KCBM]