There have been many episodes in history where low-denomination money holdings have been exchanged with a premium over its face value. The most recent occurred in Panama only twenty five years ago, under a modern banking system. In such episodes, even where there is an entity capable to provide convertibility of money holdings at a fixed rate, and when agents expect this rate to prevail in the long run, arbitrage possibilities in the denomination of money arise as a consequence of a shortage of liquid assets and the presence of low prices in the economy. Despite of its relevance and recurrence, this phenomenon cannot be explained by current models of fiat money. To explain it we need a model where: (i) fiat money comes in different denominations which are used as a medium of exchange, (ii) there is an entity that provides convertibility of denominations at fixed rate, (iii) the natural rate is a feasible equilibrium of the model, and (iv) there are parameterizations where low denomination money holdings are given an extrinsic value. In this paper we build a money search model with all this characteristics and determine theoretically the specific conditions under which such equilibrium naturally arises.

中文翻译：

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低面额货币持有量的外部价值

历史上有很多情节，低面额的货币被兑换成其面值之上的溢价。最近的一次是在二十五年前的现代银行系统下，发生在巴拿马。在这种情况下，即使有一个实体能够以固定汇率提供货币持有量的可兑换性，并且当代理商期望从长远来看该汇率会盛行时，由于货币短缺，在货币面额上存在套利的可能性。流动资产和经济中低价的存在。尽管存在关联性和重复性，但这种现象无法用当前的法定货币模型来解释。为了说明这一点，我们需要一个模型，其中：（i）法定货币来自不同的面额，用作交易的媒介，（ii）有一个实体以固定汇率提供面额的可兑换性；（iii）自然汇率是模型的可行平衡；并且（iv）有一些参数化设置，使低面额的货币持有量具有外部价值。在本文中，我们建立了具有所有这些特征的货币搜索模型，并从理论上确定了自然产生这种平衡的具体条件。