000			01017nam a22001457a 4500
999			_c515638 _d515638
008			210203b ||||| |||| 00| 0 eng d
100			_aTella, Sebastian Di _924067
245			_aRisk Premia and the real effects of money
260			_aThe American Economic Review
300			_a110(7), Jul, 2020: p.1995-2040
520			_aThis paper proposes a flexible-price theory of the role of money in an economy with incomplete idiosyncratic risk sharing. When the risk premium goes up, money provides a safe store of value that prevents interest rates from falling, reducing investment. Investment is too high during booms when risk is low, and too low during slumps when risk is high. Monetary policy cannot correct this: money is superneutral and Ricardian equivalence holds. The optimal allocation requires the Friedman rule and a tax/subsidy on capital. The real effects of money survive even in the cashless limit. – Reproduced
773			_aThe American Economic Review
906			_aMONEY
942			_cAR