“On the Equivalence of Private and Public Money,” Mimeo, 2019

Mimeo, January 2019, with Markus Brunnermeier. PDF.

We propose a generic model of money and liquidity. We provide sufficient conditions under which a swap of private (inside) against public (outside) money leaves the equilibrium allocation and price system unchanged. We apply the results to Central Bank Digital Currency, the “Chicago Plan,” and the Indian de-monetization experiment.