IDEAS home Printed from https://ideas.repec.org/p/red/sed013/1242.html
   My bibliography  Save this paper

A Model of Monetary Exchange in Over-the-Counter Markets

Author

Listed:
  • Shengxing Zhang

    (New York University)

  • Ricardo Lagos

    (New York University)

Abstract

We develop a model of monetary exchange in over-the-counter (OTC) markets and use it to study the effects of inflation on asset prices, as well as on standard measures of financial liquidity, such as the size of bid-ask spreads, trade volume, and the incentives of dealers to supply immediacy, both by choosing to participate in the market-making activity, and by holding asset inventories on their own account.

Suggested Citation

  • Shengxing Zhang & Ricardo Lagos, 2013. "A Model of Monetary Exchange in Over-the-Counter Markets," 2013 Meeting Papers 1242, Society for Economic Dynamics.
    • Handle: RePEc:red:sed013:1242
    as

    Download full text from publisher

    File URL: https://red-files-public.s3.amazonaws.com/meetpapers/2013/paper_1242.pdf
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Han, Han, 2015. "Over-the-Counter Markets, Intermediation, and Monetary Policy," MPRA Paper 68709, University Library of Munich, Germany.
    2. Boyan Jovanovic & Viktor Tsyrennikov, 2022. "Trading on Sunspots," American Economic Review, American Economic Association, vol. 112(12), pages 3970-3994, December.
    3. Seungduck Lee & Kuk Mo Jung, 2020. "A Liquidity‐Based Resolution of the Uncovered Interest Parity Puzzle," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 52(6), pages 1397-1433, September.
    4. Trejos, Alberto & Wright, Randall, 2016. "Search-based models of money and finance: An integrated approach," Journal of Economic Theory, Elsevier, vol. 164(C), pages 10-31.
    5. Fabrizio Mattesini & Ed Nosal, 2011. "Cash-in-the-Market Pricing in a Model with Money and Over-the-Counter Financial Markets," Working Paper Series WP-2013-24, Federal Reserve Bank of Chicago.
    6. Tai‐Wei Hu & Guillaume Rocheteau, 2015. "Monetary Policy and Asset Prices: A Mechanism Design Approach," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 47(S2), pages 39-76, June.
    7. Mattesini, Fabrizio & Nosal, Ed, 2016. "Liquidity and asset prices in a monetary model with OTC asset markets," Journal of Economic Theory, Elsevier, vol. 164(C), pages 187-217.

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:red:sed013:1242. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Christian Zimmermann (email available below). General contact details of provider: https://edirc.repec.org/data/sedddea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.