Job Market Paper

• A Monetary Model of Unit of Account

I develop a dynamic model in which money is used as means of payment in spot transactions (medium of exchange role) and competes with goods to denominate payments in credit transactions (unit of account role). The value of money and the unit of account are determined jointly in equilibrium. Money is the unit of account if its value is stable, in the sense of having small enough unexpected deflation risk. In the model, if a local currency is not stable, a foreign currency can be used as the unit of account, as in dollarization episodes. Monetary policy has two distinct goals: low inflation for the medium-of-exchange role and price stability for the unit-of-account role.

Publications

• Corporate Bond Liquidity during the COVID-19 Crisis with Mahyar Kargar, Benjamin Lester, David Lindsay, Shuo Liu, and Pierre-Olivier Weill. (Review of Financial Studies, 2021)

  • Non-technical summary 

Work in Progress

• Trading Relationships in the US Corporate Bond Market (with David Lindsay)