Berlin 2018 – wissenschaftliches Programm

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SOE: Fachverband Physik sozio-ökonomischer Systeme

SOE 3: Economic Models I

SOE 3.2: Vortrag

Montag, 12. März 2018, 10:45–11:00, MA 001

Stability analysis of a time-homogeneous system of money and antimoney in an agent-based random economy — •Julian Stein and Dieter Braun — Systems Biophysics LMU

One source of financial instability might be the creation of money [1] also leading to non-local transfers of wealth (Cantillon effect) and a loss of economic memory [2]. Motivated by an analogy to particle physics, time-homogeneity can be imposed on monetary systems to solve the associated problems. As a result, full reserve banking is implemented by a two-currency system of non-bank (money) and bank assets (antimoney) [3]. Payments are either made by passing on money or receiving antimoney at respective price levels. Liquidity is provided by the simultaneous transfer of money and antimoney from seller to buyer at a negotiated liquidity price. Thus interest rates and credit are implemented by a varying price for liquidity. We aim to study the problem of credit crunches in such systems. An agent-based random economy is set-up, in which households and firms apply stochastic trading strategies to exchange goods via a limit order book mechanism.

The comparison of the prevailing monetary system with the money-antimoney system shows that symmetric price equilibria can be reached by imposing a limit on the agents antimoney holdings. Quantity theory is satisfied. Crash and boom scenarios show a quantitative and qualitative similar behavior for the different monetary systems, indicating the overall functionality of the money-antimoney system.

[1] Am Econ Rev 102 (2012) [2] New J Phys 16, 033024 (2014), [3] Physica A 290, 491 (2001)