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VOL. 53 | 2009 The Friedman rule under habit formation
Yoshimasa Aoki, Yasunobu Tomoda

Editor(s) Saber Elaydi, Kazuo Nishimura, Mitsuhiro Shishikura, Nobuyuki Tose

Abstract

This paper studies the Friedman rule on the optimal quantity of money in a money in the utility model with habit formation. If habits are formed only in consumption, or if habit formations in both consumption and real money holdings are symmetric, the Friedman rule is optimal. However, if habit forming is assumed in real money holdings, then the Freidman rule may not be optimal.

Information

Published: 1 January 2009
First available in Project Euclid: 28 November 2018

zbMATH: 1184.91144
MathSciNet: MR2582433

Digital Object Identifier: 10.2969/aspm/05310363

PROCEEDINGS ARTICLE
8 PAGES


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Vol. 53 • 1 January 2009
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