Capital trading, stock trading, and the inflation tax on   equity
Subtitle: a note
By: by Scott L. Baier ... [et al.].
Contributors: Baier, Scott L.
Series: Working paper ;; 03-21; Working paper (Federal Reserve Bank of Cleveland : Online) ;; 03-21.
Publisher: Federal Reserve Bank of Cleveland
Published: 2003
Place of publication: [Cleveland, Ohio]
Language: eng
Format: Electronic resource
Description: "In Capital Trading, Stock Trading, and the Inflation Tax on Equity, Chami, Cosimano, and Fullenkamp (2001) (hereafter, CCF) analyze a cash-in-advance model in which capital goods are explicitly traded.  The authors show that there is more responsiveness of consumption and output to changes in the money supply than exists in the standard neoclassical growth models.  This note demonstrates that this arises because CCF implicitly imposed an additional equilibrium restriction on the Cooley and Hansen (1989) model.  This restriction can be imposed only if the Cooley and Hansen model is subject to real indeterminacy which occurs whenever the risk aversion coefficient (denoted by lambda in the CCF paper) exceeds 2"--Federal Reserve Bank of Richmond web site.
Notes: Also available in print.
Includes bibliographical references.
Title from PDF file as viewed on 1/15/2005.
System requirements: Adobe Acrobat Reader.
Mode of access: World Wide Web.