Heterogeneity and Lotteries in Monetary Search Models


  • We would like to thank Aleks Berentsen, Gabriele Camera, and Randy Wright for their comments on this paper. We thank the Federal Reserve Bank of Cleveland and ERMES at Paris II for research support.


We introduce ex ante heterogeneity into the Berentsen, Molico, and Wright monetary search model with lotteries. We show that their three main results regarding lotteries do not survive this modification of the environment.