Journal ArticleDOI
The optimal bankruptcy rule in a trading economy using fiat money
Martin Shubik,Charles Wilson +1 more
- Vol. 37, Iss: 3, pp 337-354
TLDR
In this paper, an outside bank, and borrowing are considered explicitly and the meaning of an optimal bankruptcy rule are considered, and the authors deal primarily with problems in modelling and interpretation of a monetary economy.Abstract:
Abstract : In several previous papers models of a monetary economy have been solved as a noncooperative game. The problem of granting credit and the possibility of bankruptcy was avoided by the artifact of considering that all traders were supplied with 'enough' of a commodity serving as a 'money' or means of payment so that there was no need to borrow. In this paper an outside bank, and borrowing are considered explicitly and the meaning of an optimal bankruptcy rule are considered. This paper deals primarily with problems in modelling and interpretation.read more
Citations
More filters
Posted Content
Default and Punishment in General Equilibrium
TL;DR: In this article, the authors extend the standard model of general equilibrium with incomplete markets to allow for default and punishment by thinking of assets as pools, and show that refined equilibrium always exists in their model, and that default, in conjunction with refinement, opens the door to a theory of endogenous assets.
Journal ArticleDOI
Procyclicality and the new Basel Accord - banks’ choice of loan rating system
TL;DR: The authors used a general equilibrium model of the financial system to explore whether banks would choose to use a countercyclical, procyclical or neutral rating scheme and found that banks would not choose a stable rating approach, which has important policy implications for the design of the Accord.
Posted Content
A Model to Analyse Financial Fragility
TL;DR: In this article, a tractable model which illuminates problems relating to individual bank behaviour, to possible contagious inter-relationships between banks, and to the appropriate design of prudential requirements and incentives to limit ''excessive' risk-taking is presented.
Journal ArticleDOI
An introduction to general equilibrium with incomplete asset markets
TL;DR: In this article, the major results in the theory of general equilibrium with incomplete asset markets are surveyed, and a few suggestions for further work are made for further research. And the papers in this volume are introduced and discussed.
Journal ArticleDOI
A Theory of Money and Financial Institutions. Part 28. The Noncooperative Equilibria of a Closed Trading Economy with Market Supply and Bidding Strategies
Pradeep Dubey,Martin Shubik +1 more
TL;DR: Shubik and Shubik as discussed by the authors examined a noncooperative equilibrium solution to one of the alternative models and to contrasting this with the non-cooperative solution to the original model.
References
More filters
Journal ArticleDOI
Trade Using One Commodity as a Means of Payment
Lloyd S. Shapley,Martin Shubik +1 more
TL;DR: In this article, a general non-cooperative trading equilibrium is described in which prices depend in a natural way on the buying and selling decisions of the traders, avoiding the classical assumption that individuals must regard prices as fixed.
Journal ArticleDOI
COMMODITY MONEY, OLIGOPOLY, CREDIT and BANKRUPTCY IN A GENERAL EQUILIBRIUM MODEL
Journal ArticleDOI
The tracing procedure: A Bayesian approach to defining a solution forn-person noncooperative games
TL;DR: In this paper, a Bayesian approach is proposed to select a particular equilibrium point of a non-cooperative game as the solution for a given game, where each player starts his analysis of the game situation by assigning a subjective prior probability distribution to the set of all pure strategies available to each other player.