COWLES FOUNDATION FOR RESEARCH IN ECONOMICS
AT YALE UNIVERSITY

Box 208281
New Haven, CT 06520-8281

COWLES FOUNDATION DISCUSSION PAPER NO. 1050

"The Money Rate of Interest and the Influence of Assets
in a Multistage Economy with Gold or Paper Money: Part II"

Martin Shubik and Shuntian Yao

June 1993

We consider the relationship between the length of life of individuals and the assets they own and their influence on trustless trade. In particular in some structures a role for government or an outside bank may be called for to support an equilibrium. An example of an OLG model with production illustrates the need for expanding the fiat money supply if population growth is greater than zero.