AMAD
"Archivum Medii Aevi Digitale - Specialized open access repository for research in the middle ages"To submission
| Date: | 2011 |
| Title: | DOMESTIC EXCHANGE RATE DETERMINATION IN EARLY RENAISSANCE FLORENCE |
| Contributor: | The Pennsylvania State University CiteSeerX Archives |
| Author: | G. Geoffrey Booth Ivor Grattan-guinness Kenneth Frank Sanders S. Chang |
| Description: | Abstract: We explore the strategic dynamics of the price setting protocol used by the money-changers guild to set the daily domestic exchange rate between gold and silver coins in early Renaissance Florence. We frame our analysis as a repeat, non-constant sum game of indeterminate length characterized by voluntary participation and asymmetric information. A dynamically stable Nash equilibrium obtains and guild profits maximized if only a few informed players participate, suggesting that the Florentine protocol was an effective price setting mechanism. It is not surprising, therefore, that the protocol was in force for at least 100 years and that some of its characteristics are echoed in modern financial markets. |
| URI: | https://www.amad.org/jspui/handle/123456789/64761 |
| Other Identifier: | http://www.aeaweb.org/aea/2012conference/program/retrieve.php?pdfid=112 http://citeseerx.ist.psu.edu/viewdoc/summary?doi=10.1.1.231.3747 |
| AMAD ID: | 673413 |
| Appears in Collections: | BASE (Bielefeld Academic Search Engine) General history of Europe |
