@article {101, title = {Experimental Methods for Measuring Social Networks without Censoring}, journal = {Journal of Experimental Political Science}, year = {Forthcoming}, abstract = {We elicit social networks among students in an Italian high school either by measuring the complete network in an incentive-compatible way or by using a truncated elicitation of at most five links. We find that truncation undercounts weak links by up to 90\% but only moderately undercounts the time spent with strong friends. We use simulations to demonstrate that the measurement error induced by censoring might be particularly significant when studying phenomena such as social learning which are often thought to operate along weak ties. We then discuss how a modified network elicitation protocol might be able to reduce measurement error.}, author = {Rebecca Morton and Eleonora Patacchini and Paolo Pin and Jonathan Rogers and Tanya Rosenblat} } @article {92, title = {Correcting Misperceptions about Support for Social Distancing to Combat COVID-19}, journal = {Economic Development and Cultural Change}, year = {Forthcoming}, month = {2023}, abstract = { Can informing people of high community support for social distancing encourage them to do more of it? We randomly assigned a treatment correcting individuals{\textquoteright} underestimates of community support for social distancing. In theory, informing people that more neighbors support social distancing than expected encourages free-riding and lowers the perceived benefits from social distancing. At the same time, the treatment induces people to revise their beliefs about the infectiousness of COVID-19 upwards; this perceived infectiousness effect as well as the norm adherence effect increase the perceived benefits from social distancing. We estimate impacts on social distancing, measured using a combination of self- reports and reports of others. While experts surveyed in advance expected the treatment to increase social distancing, we find that its average effect is close to zero and significantly lower than expert predictions. However, the treatment{\textquoteright}s effect is heterogeneous, as predicted by theory: it decreases social distancing where current COVID-19 cases are low (where free-riding dominates), but increases it where cases are high (where the perceived-infectiousness effect dominates). These findings highlight that correcting misperceptions may have heterogeneous effects depending on disease prevalence. }, url = {https://doi.org/10.1086/727192}, author = {James Allen and Arlete Mahumane and James Riddell and Dean Yang and Hang Yu} } @article {97, title = {Managing Self-Confidence: Theory and Experimental Evidence}, journal = {Management Science}, volume = {68}, number = {11}, year = {2022}, pages = {7793-8514}, abstract = {We use a series of experiments to understand whether and how people{\textquoteright}s beliefs about their own abilities are biased relative to the Bayesian benchmark and how these beliefs then affect behavior. We find that subjects systematically and substantially overweight positive feedback relative to negative (asymmetry) and also update too little overall (conservatism). These biases are substantially less pronounced in an ego-free control experiment. Updating does retain enough of the structure of Bayes{\textquoteright} rule to let us model it coherently in an optimizing framework, in which, interestingly, asymmetry and conservatism emerge as complementary biases. We also find that exogenous changes in beliefs affect subjects{\textquoteright} decisions to enter into a competition and do so similarly for more and less biased subjects, suggesting that people cannot "undo" their biases when the time comes to decide.}, url = {https://doi.org/10.1287/mnsc.2021.4294}, author = {Markus M. Mobius and Muriel Niederle and Paul Niehaus and Tanya Rosenblat} } @article {95, title = {Teaching and Incentives: Substitutes or Complements?}, journal = {Economics of Education Review}, volume = {91}, number = {December}, year = {2022}, abstract = {Interventions to promote learning are often categorized into supply- and demand-side approaches. In a randomized experiment to promote learning about COVID-19 among Mozambican adults, we study the interaction between a supply and a demand intervention, respectively: teaching via targeted feedback, and providing financial incentives to learners. In theory, teaching and learner-incentives may be substitutes (crowding out one another) or complements (enhancing one another). Experts surveyed in advance predicted a high degree of substitutability between the two treatments. In contrast, we find substantially more complementarity than experts predicted. Combining teaching and incentive treatments raises COVID-19 knowledge test scores by 0.5\ standard deviations, though the standalone teaching treatment is the most cost-effective. The complementarity between teaching and incentives persists in the longer run, over nine months post-treatment.}, url = {https://doi.org/10.1016/j.econedurev.2022.102317}, author = {James Allen and Arlete Mahumane and James Riddell and Tanya Rosenblat and Dean Yang and Hang Yu} } @book {90, title = {Handbook of Experimental Game Theory}, year = {2020}, abstract = {The aim of this Handbook is twofold: to educate and to inspire. It is meant for researchers and graduate students who are interested in taking a data-based and behavioral approach to the study of game theory. Educators and students of economics will find the Handbook useful as a companion book to conventional upper-level game theory textbooks, enabling them to compare and contrast actual behavior with theoretical predictions. Researchers and non-specialists will find valuable examples of laboratory and field experiments that test game theoretic propositions and suggest new ways of modeling strategic behavior. Chapters are organized into several sections; each section concludes with an inspirational chapter, offering suggestions on new directions and cutting-edge topics of research in experimental game theory.} } @article {83, title = {Does Driving as a Form of \“Gig Work\” Mitigate Low-Skilled Job Seekers\’ Negative Long-Term Unemployment Effects?}, journal = {Proceedings of ACM Human-Computer Interaction}, year = {2019}, month = {2019}, author = {Li, Linfeng and Dillahunt, Tawanna R. and Tanya Rosenblat} } @article {5, title = {Are Risk Attitudes Fixed Factors or Fleeting Feelings?}, journal = {Journal of Labor Research}, volume = {39}, year = {2018}, month = {Feb}, pages = {1-23}, abstract = {We investigate the stability of measured risk attitudes over time, using a 13-year longitudinal sample of individuals in the National Longitudinal Survey of Youth 1979. We find that an individual{\textquoteright}s risk aversion changes systematically in response to personal economic circumstances. Risk aversion increases with lengthening spells of employment and time out of labor force, and decreases with lengthening unemployment spells. However, the most important result is that the majority of the variation in risk aversion is due to changes in measured individual tastes over time and not to variation across individuals. These findings that measured risk preferences are endogenous and subject to substantial measurement errors suggest caution in interpreting coefficients in models relying on contemporaneous, one-time measures of risk preferences.}, url = {https://doi.org/10.1007/s12122-018-9262-2}, author = {Cho, Insoo and Orazem, Peter F. and Tanya Rosenblat} } @unpublished {24, title = {Social Networks and Vaccination Decisions}, journal = {FRB of Boston Working Paper No. 07-12}, year = {2017}, month = {November 2007}, abstract = {We combine survey responses, network data, and medical records in order to examine how friends affect the decision to get vaccinated against influenza. The random assignment of undergraduates to residential halls at a large private university generates exogenous variation in exposure to the vaccine, enabling us to credibly identify social effects. We find evidence of positive peer influences on health beliefs and vaccination choices. In addition, we develop a novel procedure to distinguish between different forms of social effects. Most of the impact of friends on immunization behavior is attributable to social learning about the medical benefits of the vaccine.}, url = {http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1073143}, author = {Neel Rao and Markus Mobius and Tanya Rosenblat} } @conference {6, title = {Uncovering the Values and Constraints of Real-time Ridesharing for Low-resource Populations}, booktitle = {Proceedings of the 2017 CHI Conference on Human Factors in Computing Systems}, series = {CHI {\textquoteright}17}, year = {2017}, pages = {2757{\textendash}2769}, publisher = {ACM}, organization = {ACM}, address = {New York, NY, USA}, keywords = {low-income populations, mobility, real-time ridesharing services, sharing economy, transportation scarcity, uber}, isbn = {978-1-4503-4655-9}, url = {http://doi.acm.org/10.1145/3025453.3025470}, author = {Dillahunt, Tawanna R. and Kameswaran, Vaishnav and Li, Linfeng and Tanya Rosenblat} } @article {9, title = {Ethnic Discrimination: Evidence from China}, journal = {European Economic Review}, volume = {90}, year = {2016}, pages = {165-177}, abstract = {We study the role of ethnicity in experimental labor markets where {\textquotedblleft}employers{\textquotedblright} determine wages of {\textquotedblleft}workers{\textquotedblright} who perform a real effort task. This task requires a true skill which we show is not affected by minority status. In some treatments, we provide subtle priming to employers about minority status of workers as commonly depicted on Chinese {\textquotedblleft}Hukou{\textquotedblright} identification system. We conduct our experiments at two sites located in provinces that differ by their historical shares of ethnic groups in the population. We find that: (1) Han and minority workers are equally productive in both provinces; (2) in the diverse province, there is no difference in the wages between Han and minority workers; (3) in the non-diverse province, minority workers receive 4\%-7\% lower wages than Han workers.}, url = {https://doi.org/10.1016/j.euroecorev.2016.04.004}, author = {Markus Mobius and Tanya Rosenblat} } @inbook {8, title = {Informal Transfers in Social Networks}, booktitle = {The Oxford Handbook of the Economics of Networks}, year = {2016}, pages = {611-629}, publisher = {Oxford University Press}, organization = {Oxford University Press}, abstract = {Social networks can facilitate informal lending and risk-sharing in situations where for-mal institutions such as banks and insurance companies do not exist. The social collateral approach provides an analytically tractable framework that can be used to analyze a wide range of informal transfers. Moreover, the approach is easily amenable to empirical analysis.}, url = {https://doi.org/10.1093/oxfordhb/9780199948277.013.28}, author = {Markus Mobius and Tanya Rosenblat} } @article {7, title = {Social Norms Regarding Bribing in India: An Experimental Analysis}, journal = {Schmollers Jahrbuch}, volume = {136}, number = {2}, year = {2016}, pages = {171{\textendash}197}, publisher = {Duncker \& Humblot}, url = {https://doi.org/10.3790/schm.136.2.171}, author = {Ritwik Banerjee and Tushi Baul and Tanya Rosenblat} } @unpublished {25, title = {Measuring Trust in Peruvian Shantytowns}, journal = {Working Paper}, year = {2015}, month = {September 2010}, abstract = {This paper uses a microfinance field experiment in two Lima shantytowns to measure the relative importance of social networks and prices for borrowing. Our design randomizes the interest rate on loans provided by a microfinance agency, as a function of the social distance between the borrower and the cosigner. This design effectively varies the relative price (interest rate differential) of having a direct friend versus an indirect friend as a cosigner. After loans are processed, a second randomization relieves some cosigners from their responsibility. These experiments yield three main results. (1) As emphasized by sociologists, connections are highly valuable: having a friend cosigner is equivalent to 18 per cent of the face value of a 6 month loan. (2) While networks are important, agents do respond to price incentives and switch to a non-friend cosigner when the interest differential is large. (3) Relieving responsibility of the cosigner reduces repayment for direct friends but has no effect otherwise, suggesting that different social mechanisms operate between friends and strangers: Non-friends cosign known high types, while friends also accept low types because of social collateral or altruism.}, author = {Dean Karlan and Markus Mobius and Tanya Rosenblat and Adam Szeidl} } @inbook {10, title = {Replication in Experimental Economics}, booktitle = {Replication in Experimental Economics}, volume = {18}, year = {2015}, chapter = {11}, url = {https://www.emeraldinsight.com/doi/abs/10.1108/S0193-230620150000018011} } @article {11, title = {On self selection of the corrupt into the public sector}, journal = {Economic Letters}, volume = {127}, year = {2015}, pages = {43-46}, abstract = {Do corrupt people self select themselves in professions where the scope of corruption is high? We conduct a corruption experiment with private sector job aspirants and aspirants of Indian bureaucracy. The game models embezzlement of resources in which {\textquotedblleft}supervisors{\textquotedblright} evaluate the performance of {\textquotedblleft}workers{\textquotedblright} and then pay them. We find that aspirant bureaucrats indulge in more corruption than private sector aspirants but the likelihood of being corrupt is same across two sectors.}, url = {http://www.sciencedirect.com/science/article/pii/S0165176514004819}, author = {Ritwik Banerjee and Tushi Baul and Tanya Rosenblat} } @unpublished {26, title = {Managing Self-Confidence}, year = {2014}, abstract = {Stylized evidence suggests that people process information about their own ability in a biased manner. We provide a precise characterization of the nature and extent of these biases. We directly elicit experimental subjects{\textquoteright} beliefs about their relative performance on an IQ quiz and track the evolution of these beliefs in response to noisy feedback. Our main result is that subjects update as if they misinterpret the information content of signals, but then process these misinterpreted signals like Bayesians. Specifically, they are asymmetric, over-weighting positive feedback relative to negative, and conservative, updating too little in response to both positive and negative feedback. These biases are substantially less pronounced in a placebo experiment where ego is not at stake, suggesting they are motivated rather than cognitive. Consistent with Bayes{\textquoteright} rule, on the other hand, updating is invariant to priors (and over time) and priors are sufficient statistics for past information. Based on these findings, we build a model that theoretically derives the optimal bias of a decision-maker with ego utility and show that it naturally gives rise to both asymmetry and conservatism as complementary strategies in self-confidence management.}, author = {Markus Mobius and Muriel Niederle and Paul Niehaus and Tanya Rosenblat} } @article {12, title = {Social Learning in Economics}, journal = {Annual Review of Economics}, volume = {6}, number = {1}, year = {2014}, pages = {827-847}, abstract = {Social learning is a rapidly growing field for empirical and theoretical research in economics. We encounter social learning in many economically important phenomena, such as the adoption of new products and technologies or job search in labor markets. We review the existing empirical and theoretical literatures and argue that they have evolved largely independently of each other. This suggests several directions for future research that can help bridge the gap between both literatures. For example, the theory literature has come up with several models of social learning, ranging from na{\"{\i}ve DeGroot models to sophisticated Bayesian models whose assumptions and predictions need to be empirically tested. Alternatively, empiricists have often observed that social learning is more localized than existing theory models assume, and that information can decay along a transmission path. Incorporating these findings into our models might require theorists to look beyond asymptotic convergence in social learning.}, url = {http://www.annualreviews.org/action/showCitFormats?doi=10.1146\%2Fannurev-economics-120213-012609}, author = {Markus Mobius and Tanya Rosenblat} } @unpublished {27, title = {Social Networks and Consumer Demand}, year = {2011}, month = {January 2011}, author = {Markus Mobius and Paul Niehaus and Tanya Rosenblat} } @article {13, title = {What Do We Expect From Our Friends?}, journal = {Journal of European Economic Association}, volume = {8}, number = {1}, year = {2010}, pages = {120-138}, abstract = {We conduct a field experiment in a large real-world social network to examine how subjects expect to be treated by their friends and by strangers who make allocation decisions in modified dictator games. While recipients{\textquoteright} beliefs accurately account for the extent to which friends will choose more generous allocations than strangers (i.e. directed altruism), recipients are not able to anticipate individual differences in the baseline altruism of allocators (measured by giving to an unnamed recipient, which is predictive of generosity towards named recipients). Recipients who are direct friends with the allocator, or even recipients with many common friends, are no more accurate in recognizing intrinsically altruistic allocators. Recipient beliefs are significantly less accurate than the predictions of an econometrician who knows the allocator{\textquoteright}s demographic characteristics and social distance, suggesting recipients do not have information on unobservable characteristics of the allocator.}, url = {https://doi.org/10.1111/j.1542-4774.2010.tb00497.x}, author = {Stephen Leider and Markus Mobius and Tanya Rosenblat and Quoc-Anh Do} } @article {14, title = {Directed Altruism and Enforced Reciprocity in Social Network}, journal = {Quarterly Journal of Economics}, volume = {124}, number = {1}, year = {2009}, pages = {1815{\textendash}1851}, abstract = {We conduct online field experiments in large real-world social networks in order to decompose prosocial giving into three components: (1) baseline altruism toward randomly selected strangers, (2) directed altruism that favors friends over random strangers, and (3) giving motivated by the prospect of future interaction. Directed altruism increases giving to friends by 52 percent relative to random strangers, while future interaction effects increase giving by an additional 24 percent when giving is socially efficient. This finding suggests that future interaction affects giving through a repeated game mechanism where agents can be rewarded for granting efficiency-enhancing favors. We also find that subjects with higher baseline altruism have friends with higher baseline altruism.}, url = {https://doi.org/10.1162/qjec.2009.124.4.1815}, author = {Stephen Leider and Markus Mobius and Tanya Rosenblat and Quoc-Anh Do} } @article {15, title = {Trust and Social Collateral}, journal = {Quarterly Journal of Economics}, volume = {124}, number = {3}, year = {2009}, pages = {1307{\textendash}1361}, abstract = { This paper builds a theory of trust based on informal contract enforcement in social networks. In our model, network connections between individuals can be used as social collateral to secure informal borrowing. We de…ne network-based trust as the highest amount one agent can borrow from another agent, and derive a reduced-form expression for this quantity which we then use in three applications. (1) We predict that dense networks generate bonding social capital that allows transacting valuable assets, while loose networks create bridging social capital that improves access to cheap favors like information. (2) For job recommendation networks, we show that strong ties between employers and trusted recommenders reduce asymmetric information about the qualityof job candidates. (3) Using data from Peru, we show empirically that network-based trust predicts informal borrowing, and we structurally estimate and test our model. Program to visualize/calculate trust flow }, url = {https://doi.org/10.1162/qjec.2009.124.3.1307}, author = {Dean Karlan and Markus Mobius and Tanya Rosenblat and Adam Szeidl} } @article {16, title = {Vertical Integration of Successive Monopolists: A Classroom Experiment}, journal = {Perspectives on Economic Education Research}, volume = {Spring}, number = {5}, year = {2009}, abstract = {This classroom experiment introduces students to the concept of double marginalization, i.e. the exercise of market power at successive vertical layers in a supply chain. By taking on roles of firms, students determine how the mark-ups are set at each successive production stage. They learn that final retail prices tend to be higher than if the firms were vertically integrated. Students compare the welfare implications of two potential solutions to the double marginalization problem: acquisition and franchise fees. The experiment also can stimulate a discussion of two-part tariffs, transfer pricing, contracting, and the Coase theorem. Veconlab website}, url = {http://faculty.haas.berkeley.edu/rjmorgan/classroom_experiments.htm}, author = {Narine Badasyan and Jacob K. Goeree and Monica Hartmann and Charles Holt and John Morgan and Tanya Rosenblat and Maros Servatka and Dirk Yandell} } @article {17, title = {The Beauty Premium: Physical Attractiveness and Gender in Dictator Games}, journal = {Negotiation Journal}, volume = {24}, number = {4}, year = {2008}, pages = {465-481}, abstract = {Are beautiful people better negotiators? I present evidence from a simple bargaining game where players can listen to pre-recorded {\textquotedblleft}speeches{\textquotedblright} and see the pictures of other players. I find that physically attractive players receive a greater share of the surplus if the partner can both listen to their speech and view their picture. This effect is strongest when the listening partner is female. These results suggest new directions for experimental and empirical research on the role of non-resume characteristics on labor market outcomes and give new perspectives to practitioners in negotiations involving extreme power imbalance.}, url = {https://doi.org/10.1111/j.1571-9979.2008.00198.x}, author = {Tanya Rosenblat} } @article {18, title = {Community Size and Network Closure}, journal = {American Economic Review Papers and Proceedings}, volume = {97}, number = {2}, year = {2007}, pages = {80-85}, url = {http://www.jstor.org/stable/30034425}, author = {Hunt Allcott and Dean Karlan and Markus Mobius and Tanya Rosenblat and Adam Szeidl} } @article {19, title = {Why Beauty Matters}, journal = {American Economic Review}, volume = {96}, number = {1}, year = {2006}, pages = {222-235}, abstract = {We decompose the beauty premium in an experimental labor market where "employers" determine wages of "workers" who perform a maze-solving task. This task requires a true skill which we show to be una{\textregistered}ected by physical attractiveness. We find a sizable beauty premium and can identify three transmission channels. (1) Physically-attractive workers are more confident and higher confidence increases wages. (2) For a given level of confidence, physically-attractive workers are (wrongly) considered more able by employers. (3) Controlling for worker confidence, physically-attractive workers have oral skills (such as communication and social skills) that raise their wages when they interact with employers. Our methodology can be adapted to study the sources of discriminatory pay differentials in other settings.}, url = {https://doi.org/10.1257/000282806776157515}, author = {Tanya Rosenblat and Markus Mobius} } @unpublished {28, title = {Sequential Move Games with Information Costs}, year = {2005}, month = {August 2005}, abstract = {I study finite two player normal form games where player 2 (the {\textquoteleft}follower{\textquoteright}) can observe the move of player 1 (the {\textquoteleft}leader{\textquoteright}) by paying a small cost. I characterize the limit set of perfect equilibria of this game as the cost of information converges to zero and provide a simple algorithm for constructing it. Limit equilibria have the following properties: (a) both players choose pure strategies; (b) the follower plays a best response; (c) even though the set of limit equilibria always contains the Stackelberg equilibrium it can contain strategy profiles which are not even Nash equilibria of the normal form game. In fact, the follower will only purchase information in the Stackelberg equilibrium if the Stackelberg equilibrium is not a Nash equilibrium. Similar to Yariv and Solan (2004), the subgame perfect solution concept is therefore not robust to the introduction of small information costs. The Stackelberg equilibrium only reemerges as the unique limit equilibrium if we allow for the possibility that the leader is irrational. I test the theory experimentally using the classic Battle of the Sexes game with information acquisition. I find that subjects coordinate on the Stackelberg equilibrium and purchase information which can only be reconciled with theoretical predictions if it is common knowledge amongst subjects that the leader can be irrational.}, author = {Tanya Rosenblat} } @article {20, title = {Ricardian Explorer}, journal = {The Basics of International Trade: A Classroom Experiment}, year = {2005}, abstract = {We introduce a simple web-based classroom experiment in which students learn the Ricardian model of international trade. Students are assigned to countries and then make individual production, trade and consumption decisions. The analysis of experimental data introduces students to the concepts of absolute and comparative advantage, relative prices, production possibility frontier, specialization, gains from trade, utility maximization and general equilibrium. Students learn about the relationship between individual decision-making and aggregate economic activity. The associated software, Ricardian Explorer, is easy to setup and requires minimal preparation time for instructors. The game is developed as a tool to complement courses in international trade, but it can be used in introductory and intermediate microeconomics courses as well. The analysis of teaching effectiveness has demonstrated that integration of this experiment in the curriculum enhances student learning.}, url = {http://www.wesleyan.edu/re/index.html}, author = {Alberto Isgut and Ganesan Ravishanker and Tanya Rosenblat} } @article {21, title = {Getting Closer or Drifting Apart}, journal = {Quarterly Journal of Economics}, volume = {119}, number = {3}, year = {2004}, pages = {971-1009}, abstract = { Advances in communication and transportation technologies have the potential to bring people closer together and create a {\textquoteleft}global village{\textquoteright}. However, they also allow heterogenous agents to segregate along special interests which gives rise to communities fragmented by type rather than geography. We show that lower communication costs should always decrease separation between individual agents even as group-based separation increases. Each measure of separation is pertinent for distinct types of social interaction. A group-based measure captures the diversity of group preferences that can have an impact on the provision of public goods. An individual measure correlates with the speed of information transmission through the social network that affects, for example, learning about job opportunities and new technologies. We test the model by looking at coauthoring between academic economists before and during the rise of the Internet in the 1990s. }, url = {https://doi.org/10.1162/0033553041502199}, author = {Tanya Rosenblat and Markus Mobius} } @unpublished {29, title = {Formation of Social Capital: An Experiment}, year = {2002}, month = {December 2002}, abstract = {We study the formation of social capital in an environment where specialized agents have frequent diverse needs. This limits the potential of purely bilateral cooperation because the interaction frequency between any two particular agents is low. Such interactions usually invite defection by both sides unless agents are altruistic, or there exist information aggregation institutions that facilitate the use of group punishments. In a companion paper Gentzkow and Mobius (2002) develop a theory of how agents can cooperate even in a limited information environment as long as they can relay requests for help. This mechanism creates networks with long-term relationships which are continuously recombined to satisfy short-term needs. We test the theoretical predictions by conducting an experiment with two treatments: in the first treatment, agents can only utilize direct {\textquoteleft}favors{\textquoteright} while the second treatment adds the ability to provide indirect {\textquoteleft}favors{\textquoteright} as well. Our results help us understand how agents form and sustain weak links.}, author = {Markus Mobius and Tanya Rosenblat} } @unpublished {30, title = {The Process of Ghetto Formation: Evidence from Chicago}, year = {2001}, month = {December 2001}, author = {Markus Mobius and Tanya Rosenblat} } @unpublished {31, title = {On the Transition Between Monetary Regimes}, year = {2001}, month = {July 2001}, abstract = {Historically, commodity money preceded fiat money. Standard search-theoretical models of money such as Kiyotaki and Wright (1989) cannot explain this transition because of multiple equilibria: a small infusion of fiat money with superior intrinsic characteristics into a commodity money equilibrium is always valued if agents believe in its acceptability. We propose a natural extension of the standard model in order to break this indeterminacy. We assume (1) that agents derive positive utility from consuming even non-favorite commodities and (2) that agents have to consume regularly. We find that agents accept only commodity money if search frictions are large. Fiat money can become valuable in sufficiently advanced economies with small search frictions.}, author = {Tanya Rosenblat and Markus Mobius} }